Loading...
HomeMy WebLinkAbout025045 RES - 10/08/2002 RESOLUTION APPROVING THE RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS BY THE CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION AND THE EXECUTION OF A PROJECT AGREEMENT, AND A BOND PURCHASE AGREEMENT WITH RESPECT TO THE ARENA PROJECT WHEREAS, Corpus Christi Business and Job Development Corporation (the "Corporation") was created under the auspices of the City of Corpus Christi, Texas (the "City"); and WHEREAS, the Corporation heretofore has issued, and the City approved the issuance of, its Sales Tax Revenue Notes, Taxable Series 2001 (Arena Project) (the "Series 2001 Notes"), for the purpose of paying the costs of acquiring land and other related costs to the development of the "Arena Project"; and WHEREAS, the Corporation by resolution adopted October 7, 2002 authorized the issuance of the hereinafter described bonds for the purposes described in said resolution; and WHEREAS, it is deemed necessary and advisable that this Resolution be adopted. THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI THAT: Section 1. The resolution (the "Resolution") adopted by the Corporation, in substantially the form and substance as attached to this Resolution and made a part hereof for all purposes, is hereby approved, and sales tax revenue bonds in the principal amount not to exceed $50,000,000 (the "Bonds"), may be issued for the purpose of refunding the Series 2001 Notes, paying the costs of issuance incurred in connection with the sale of the Bonds, and providing all or a portion of the cost of the project as specified in the Resolution (the "Project") for use by the City, which Project is in compliance with the Development Corporation Act of 1979, as amended; and said Resolution, Bonds and Project are hereby approved. Section 2. The "Project Agreement" between the City and the Corporation, in substantially the form and substance as attached to this Resolution and made a part hereof for all purposes, is hereby approved and the City Manager and the City Secretary are hereby authorized to execute, attest, seal and deliver the Project Agreement. Section 3. The "Bond Purchase Agreement" between the Corporation and the underwriters named therein, in substantially the form and substance as attached to this Resolution and made a part hereof for all purposes, is hereby approved. RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS; AND APPROVING AND AUTHORIZING THE EXECUTION OF A BOND PURCHASE AGREEMENT AND OTHER MATTERS RELATED TO THE ISSUANCE OF THE BONDS THE STATE OF TEXAS CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION § WHEREAS, at an election held on November 7, 2000, a majority of the citizens of the City of Coq0us Christi (the "City") voting at the election authorized the C~ to levy a sales and use tax on the receipts at retail of taxable items within the City at a rate of one-eighth of one percent for the promotion and development of mi multi-purpose municipal ~ (the "Arena") and for maintenance and opemling costs of the Arena for the life thereof, to be imposed for 25 years a~ the rote of one-eighth of one percent; and WHEREAS, the City Council ofthe City levied said sales and use tax pursuant to an ordinance adopted on November 14, 2000; and WHEREAS, pursuant to the provisions of the Development Corporation Act of 1979, Article 5190.6, V.A.T.C.S, as amended (the "Act"), particularly Section 4A thereof, the City created the Corpus Christi Business and Job Developmem Corporation (the "Issuer'), a nonstock, nonprofit industrial development corporation created to act on behalf of the City to satis~ the public purposes set forth in the Act, specifically the putlxw~e of promoting and encoumg~ employment and the public welPare, and the undemking of cemin public iiiipgovements in accordance with the Act; and WHEREAS, in accordance wi~h the terms of the Act, the ISsuer heretofore sold and delivered its Corpus Christi Business and Job Development Corporation Sales Tax Revenue Note, Taxable Series 2001 (Arena Project), cu~,~,,ay outstanding in the aggregate principal mount of $5,000,000 (the "Series 2001 Note"); and WHEREAS, in connection with the issuance of the Series 2001 Note, the Issuer and the City executed and delivered a Sales Tax Remittance Agmem~ dated as of August 1, 2001 (the "Transfer Ag~ement") and a Project Agreement, dated as of August 1, 2001 (the "Project Agreement"); and WHEREAS, concu.~u'dy with the adoption of this Resolution the Issuer and the City shall enter into an amendmem to the Project Agreement to evidence the expansion of the "Project" (as such term is used in the Project Agreement) to include lhe constmctioth improvement aad equipping ofltle Arena and WHEREAS, the Transfer Agreement is in full force and effect, and has not been amended since the date of delivery of the Series 2001 Note, effectively converting interim financing into long-term permanent financing; and WHEREAS, the Board of Directors of the Issuer desires, pursuant to authority granted by the Act, to refund the outstanding Series 2001 Note; and WHEREAS, the Issuer has received from the owner of the Series 2001 Note a written waiver of the notice requirements for the prior redemption of the Series 2001 Note as are sec forth in the resolution authorizing the issuance oftbe Series 2001 Note; and WHEREAS, except as otherwise noted in this Resolution, capitalized temas shall have the meanings ascribed thereto in Section 6 of this Resolution; and WHEREAS, the Board of Directors of the Issuer further finds it necessary and advisable to autherize the issuance of the hereinafter described bonds in pm for the pm'pose of paying the costs of const~cting, i~iip~oving and equipping the Arena, as further described in this Resol~on. THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CORPUS CHRISTI BUSINESS AND JOB DEVELOPlVIENT CORPORATION THAT: Section 1. AMOUNT ANDPURPOSE OF THE BONDS. The bonds of the Issuer are hereby authorized to be issued and delivered pursuant to and in accordance with the Act, in an aggregate principal amount not to exceed $50,000,000 for the puq~ose of (i) ennstruoting, equipping, operating and mahl~llin~ or causing to be acquired, constructed, equipped, operated and maintained the Project, (ii) l~efunding the Series 2001 Note, and (iii) paying other costs associated with the purposes described in clauses (i) and (ii), for the specific purpose of the promotion and encoumgeraant of employment and the public welfare. Section 2. DESIGNATION OF THE BONDS. Each bond issued pumuant to this Resolution shallbe designated: "CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING AND IMPROVEMENT BOND, SERIES 2002 (ARENA PROJECT)", and there shall be issued, sold, and delivered he~nder fully registered bonds, without interest coupons, in the denomination of $5,000 each or any integral multiple thereof, numbered consecutively from R-1 upward, payable to the initial registered owner thereof designated in Section 30 of this Resolution, or to the registered assignee or assignees of any of said bonds (in each case, the "registered owner'), and payable serially or otherwise on the dates, in the years and in the principal amounts, respectively, and dated, all as set forth in the Purchase Agreement. Section 3. INTEREST. The Bonds shall bear interest calculated on the basis of a 360-day year composed oftwelve 30-day months from the dates specified in the FORM OF BOND to their respective dates of maturity at the rates set forth in the Purchase Agreement Interest on the Bonds shall be payable on the dates as set forth in the Purchase Agreement, until the maturity or print redemptinn of ~e B~. Section4. CHARACTERISTICS OF THE BONDS. (a) ~. The Issuer shall keep or cause to be kept at the designated corporate trust office in Dallas, Texas (the "Designated Trust Office") of JPMorgan Chase Bank (the "Paying Agent/Registrar"), books or records for the registration of the transfer and exchange of the Bonds (the "Registration Books"), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such ragislrations of lransfers and exchanges under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers and exchanges as herein provided. The Paying Agent/Registrar shall obtain and record in the Rcgislration Books the address of the registered owner of each Bond to which payments with respect to the BOnds shall be mailed, as herein provided; but it shall be the duty of each registered owner to notify the Paying AgenffRagisuar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. To the extent possffie and under reasonable circurrkqtances, all tramtL~s of Bonds shall be made within three business days atter request and presentation thereof. The Issuer shall have the fight ~o inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not penuit their inspection by any other entity. Registration of each Bond may be transferred in the Registration Books only upon presentation and ~runeader of such Bond to the Paying Agent/Registrar for excha%~e or transfer of registration and cancellation, together with proper written insmauents of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Re~, (i) evidencing the assignment of the Bond, or any portion thereof in any integral multiple of $5,000, to the assignee or assignees thereof, and (ii) the right of such assignee or assignees to have the Bond or any such portion thereof registered in the name of such assignee or assignees. A form of assignment shall be printed or endorsed on each Bond which shall be executed by the registered owner or its duly authorized attomc, y or representative to evidence an assignment thereof. Upon sunvnder of any Bonds or any portion or portions thereof for exchange or mmsfer of regi~afion, an authorized rodre~naative of the Paying AgenffRagislxar shall make such exchan~ or mmsfer in the Registration Books, and nhall make notation of such exchange or transfer in the Aasir~aaent section appexrin~ on each Bond to the assignee. The Issuer shall pay the Payin~ Agent/Registrars standard or customary fees and charges for malting such transfer and delivery but the one requesting exchange or such transfer shall pay any taxes or other governmental charges required to be paid with respect thereto. The Paying Agent/R~sm~ shall not be required to make exchange or transfers of registration of any Bend or any portion thereof(i) during the period amanencing with the close of business on any Record Date and ending with the opening of business on the next following laincipal or interest payment date, or, (ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date. As used herein, the term '~RecordDate" shall mean the 15th day of the month preceding an interest payment date. 3 (b) Qg~llllthill.llf~l~. The entity in whose name any Bond shall be registered in the Registration Books at any time shall be deemed and ~eated as the absolute owner thereof for all proposes of this Resolution, whether or not such Bond shall be overdue, mad the Issuer and the Paying AgentYRegislsm shall not be affected by any notice to the contxary; and payment of, or on account of, the prhicipal of, premium, if any, and interest on any such Bond shall be made only to such registered owner. All such payments shall be valid and effectual to satisfiy and discharge the liability upon such Bond to the extent of the sum or sums so paid. (c) Payment of th'ine'_mal of Bonds and Ir~erest. The Issuer hereby fmther appoints the Paying Agent/~gistrar to act as the paying agent for paying the principal of and interest on the Bonds, and to act as its agent to convert and exchange or replace Bonds, all as provided in this Resolution. The Paying Agent/RegisUar shall keep proper records of all payments made by the Issuer and the Paying Agnn~e~ with re~pect to the Bonds, and of all uansfers and exchanges of Bonds, and all replacements of Bonds, as provided in this Resolution. (d) Replacement of Bonds: Authenficatio~ Each Bond issued and delivered pursuant to this Resolution may be replaced as provided in this Section and Section 25 of this Resolution. If any Bondis replaced, lhe substitute Bond issued in ~placement for such Bond thereof shall he in the denomination of any integral multiple of $5,000 and have a p~ htcipal maturity date cotmspondlng to the malmity dam of the principal of the Bond it is replacing; and each such Bond shall bear interest at the rate applicable to and borne by the Bond it is replacing. The Paying Agent/Reg/strar shall replace Bonds as provided herein, and each fully registered bond delivered in replacement of any Bond as l~aufitted or required by any provision of this Resolution shall constitute one of the Bonds for all purposes of this Resolution, and may again be replaced. Each Bond issued and delivered pumuant to this Resolmion is not required to be, and shall not be, authenticated by the Paying A~nt/Registrar, but on each Bond issued in replacement of any Bond or Bonds issued under this Resolution, them shall be pfiai~d a "PAYING AGENT/REGISTRAR'S AUTHENTICATION CERI'IIqCATE" (the "Authentication Cer tificate'% in subsumfially the form set furda in the FORM OF BOND. An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, da~e and manually sign the Authentication Certificate, and no such Bond shall be deemed to be issued or outstanding unless the Authentication Certificate is so executed. The Payin~ Agent/Reg~has promptly shall cancel all Bonds, if any, surrendered for replacement. No additional resolutions, orders, or resolutions need be passed or adopted by the governing body ofthe Issuer or any other body or person so as to accomplish the foregoing replacement of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution, and deliveay of the substitute Bonds in the manner prescribed herein. Pursuant to Chapter 1206, Texas Government Code, the duty of replacement of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of the Authenticalion Certificate, the subttdmte Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bond which originally was issued pursuant to this Resolution, approved by the Attorney General, and registered by the Coi~ouuller of Public Accounts. 4 (e) ~Gen~ TheBondseriginallyissuedhereunderandallBoudsissuedinmplaeementofany Bond (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the registered owners thereof, (ii) may be redeemed pfior to their scheduled num~es, (iii) may be exchanged for other Bonds (iv) may be Irons f~red and assigned, (v) shall have the characteristics, (vi) shall be signed and sealed, and (vii) the pt h~cipal of and interest on the Bonds shall be payable, all as provided, and in the rammer required or indicated, in the FORM OF BOND, consistent with the provisions of the Purchase Agreement (f) Payment of Fees and Charges. The Issuer hereby covenants with the registered owners of the Bonds that it will pay the reasonable standard or customary fees and charges of the Paying AgenfRegistmr for its services with respect to the payment of lhe pth~cipal of and interest on the Bonds, when due. (g) Substitute Paying _Agem/Regi_'strar. The Issuer covenants with the registexed owners of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a coi,i},etent and legally qualified bank, lrust company, financial insfitation, or other agency to act as and perform the services of Paying Agem/Registrar fer the Bonds under this Resolution, and that the Paying AgenVRegimar will be one enthy. At the time of its appointment, any successor Paying Agent/Registrar shall have a capital stock and surplus aggregating not less than $25,000,000. The Issuer rascrves the fight to, and may, at its option, clumge the Paying Agent/Registrar upon not less than 120 days written notice to the Paying A~nrffRegistmr, to be effective not later than 60 days pfior to the next principal or interest payment date atter such notice. In the event that the entity at any time acting as Paying AgenVRegis~ (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, In,st company, financial institution, or other agency to act as Paying Agent/Registrar under this Resolution. Upon any change in the Paying Agent/Registrar, the previous Paying Agcol/Registrer promptly shah lransfer and deliver the Bonds, to the new Payin~ Agent/Registrar designated and appointed by thc Issuer. Upon any change in the Paying Agent/Registrar, thc Issuer promptly will cause a written notice thereof to be sent by the new Paying .agent/Regis[tm to each registered owner of the Bonds, by United States mail, first class postage prepaid, which notice also shall give the address ortho new Paying Agent/Regis~. By accepting thc position and performing as such, each Paying Asou'u~,egistrar shall be deemed to have agreed to the provisions of this Resolution, and a certified copy of this Resolution shall be delivered to each Paying Ca) Book-Entry Only System. The Bonds issued in exchange for the Bonds Mifi'"'""~y issued to the Underwriters slxall be initi3-------lly issued in the frnm of a separate single fully registered Bond for each of the maturities thereof. Upon ~ issuance, the owne~ip of each such Bond shall be registered in the nmae of Cede & Co., as nominee of The Depository Trust Company of New York ("DTC"), and except as provided in Section 30 hereof, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC. 5 With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the Issuer ~md the Paying Agent/Regist~ shall have no responsibility or obligation to any securities brokers and dealers, banks, trust companies, clearing coqoorations and certain other organi?ations on whose behalf DTC was created ("DTC Participant") to hold secm'ifies to facilitate the clearance and settlement of securities transactions among DTC Participants or to any person on behalf of whom such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownetabip interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a registered owner of Bonds, as shown on the Registration Books, of any notice with respect to the Bonds, or (iii) the payment to any DTC Pgticipant or any other person, other than a registered owner of Bonds, as shown in the Registration Books of any amount with respect to principal of or interest on the Bonds. Notwithstanding any other provision of this Resolution to the contrary, the Issuer and the Paying Agent/Registrar shall be entitled to l~eat and consider the person in whose name each Bond is registered in the Registration Books as the absolute owner of such Bond for the purpose of payment of principal and interest with respect to such Bond, for the purpose of registe~;,~g transfem with respect to such Bond, and for all other proposes whatsoever. Ihe Paying Agent/Registrar shall pay all principal of and interest on the Bonds only to or upon the order of the registered owners, as shown in the Registration Books as provided in this Resolution, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to ftfly satisfy and discharge the Issuers obligations with respect to payment of principal of and interest on the Bonds to the extent ofthe sum or sums so paid. No person other than a registered owner, as shown in the Regi~utaion Books, shall receive a Bond cenilieate evidencing the obligation of the Issuer to make payments of principal and interest pursuant to this Resolution. Upon delivery by DTC to the Payin4 Agent/Registrar of written notice to the eff~ that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions in this Resolution with respect to interest checks being mailed to the regist~mxl owner at the close of business on the Record Date, the words "Cede & Co." in this Resolution shall refer to such new nominee of DTC. The Issuer heretofore has executed a "Blanket Letter of Representations'' in the form prescribed by DTC, with respect to the book-onmy only system. (i) Successor Securities Depository_: Tran.qfols O~rmida Book-Entry Only Syste~n. In the event that the Issuer det~mfines that DTC is incapable of discharging its n~sibilifies described herein and in the representation letter of the Issuer to DTC or that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certiiieated Bonds, the Issuer shall (i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the appoinmaent of such successor securities depository and Ixansfer one or more separate Bonds to such successor securities depository or (ii) notify DTC and DTC Participants of the availability through DTC of Bonds and transfer one or mote separate Bonds to DTC Participants having Bonds credited to their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in the Regicide. ion Books in the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities depository, or its nominee, or in whatever 6 name or names registered owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Resolution. 0) .Ei.EI~PdIIJ~L~i~S~ Notwithstanding any other provision of this Resolution to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal of and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the mariner provided in the ~presentation letter of the Issuer to DTC. Section 5. FORM OF BONDS. The form of all Bonds issued pursuant to this Resolution, including the form of RegisWafion Certificate of the Comptroller of Public Accounts of the State of Texas to appear on the Bonds originally issued hereunder, the form of the Authentication Certificate to be printed on each Bond, and the Form of Assignment to be printed on each Bond, shall be, respectively, substantially as set forth in Exhibit A attached to this Resolution, with such appropriate variations, omissions, or Section 6. DEFINfHONS. As used in this Resolution, the following ~ shall have the meanings "Act" shall mean the Development Coipomtion Act of 1979, Article 5190.6, V.A.T.C.S., as "Additional Bonds" shall mean the additional parity revenue bonds which the Issuer reserves the right to issue inthe futu~ in accordance with Section 22 of this Resolution. "Arena" shall have the meaning given said term in the premnble to this Resolution. Investment Act, provided that such investments are at the lime maa¢ included in and authorized by the City's official inveslment policy approved from time to time by the City Council. "Board" shall mean the Board of Dkectors of the Issuer. "Bond" or "Bonds" shall mean the Corpus Christi Business and Job Development Cotpormion Sales Tax Revenue Refunding and In;,.-,tovcmcnt Bonds, Series 2002 (Arena Project), authorized to be the Bonds initially issued and delivered pursuant to this Resolution and all substitute Bonds exchanged therefor, as well as all other substitute Bonds and replacement Bonds issued pursuant hereto, and the term '~Bond" shall mcan any of thc Bonds. "City" shall mcan thc City of ~ Christi, Texas, "Code" shall mean the Internal Revenue Code of 1986, as mnendecL "Completion Obligations" means any bonds, notes or other obligations issued or incurred by the Issuer for the purpose of completing and paying any Cost of the Project for which the Bonds were issued, in accordance with the provisiom of Section 22(e) hereof. "Comptroller" shall mean the Comptroller of Public Accounts of the State of Texas, and any successor official or officer thereto. "Cost" shall mean with respect to the Project, the cost of acquisition, construction and improvement ofthe Project as provided in the Act, including, without limitation, the cost ortho acquisition of all land, rights-of-way, prope,ay fights, easements, and interests, the cost of all machinery and equipment, financing charges, interest durin4g conslmetion, necessary reserve funds, cost of estimates and of engineering and legal services, plans, specifications, surveys, estimates of cost and of mvanue, other expenses necessary or and expanding any such Project, tutminintrative expense, and such other expense as may be necessary or incidant to the acquisition, constmetio~ recons~uetion, improvement, and expansion thereof, the placin~ of the same in operation, and the financing of the Project. "Credit Facility" meam (i) a policy of insurance or a surety bond, issued by a bond insurer or an issuer of policies of insurance insuring the timely payment of debt scnvice on governmental obligations, provided that a Credit Rating Agency having an outstmding rating on Parity Bonds wonld rate the parity Bonds fully insured by a standard policy issued by the issuer in its highest generic raling category for such obligations; and (ii) a letter of credit or line of credit issued by any financial institution, provided that a Credit Rating Agency having an outstanding taring on the Parity Bonds would rate the Parity Bonds in its two highest generic rating categories for such obligations if the letter of credit or line of credit proposed to be issued by such fameial institution secured the timely payment of the entire principal amomt of the Parity Bonds and the interest thereon. whom the Issuer seeks and obtains a rating on any issue or series of Parity Bonds. "Defeasance Securities" means (i) direct, noncallable obligations of the United States of America, including obligations that m-e unconditionally guaxaiaeed by the United States of America, (ii) nonc-~lhble obligations of an agency or instrumentality of the United States of America, including obligations that are uncondin'omlly guaranteed or insured by the agency or insmunentality and ~hat, on the da~e of the purchase thereof are rated as to investment quality by a nationally recognized investment rating f.m not less than AAA or its equi~ and ('Iii) n0ncal!able obligations ora state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the date the Board adopts or approves the proceedings authorizing the financial arrangements are rated as to investment quality by a nationally recc6n~ i~ed investment rating l~'m not le~ than AAA or its equivalent. 8 "Depository Bank" shall mean the official depository bank of the City. "Election" shall mean the election held on November 7, 2000, authorizing the City to levy the Sales Tax, and any election heav~t~-r conducted with respect to the extension of, or change in the permitted uses of, the Sales Tax. "Fiscal Year" shall mean the fiscal year of the Issuer, being the twelve month period ending July 31 of each year. "inveslment Act" shall mean the Public Funds Investment Act of 1987, Chapter 2256, Texas Government Code, as ~mended, "Issuer" shall mean Corpus ~ Business ~md Job Development Coq:~oration. 'qVlSRB" means the Municipal Securities Rulemaking Board. '~[R._MSIR" means each person whom the SEC or its staff has determined to be a nationally recognized municipal secufiu'es information repository within the meaning of the Rule f~,~ ~ae to time. "Parity Bonds" shall mean the Bends and any Additional Bonds hereafter issued. "Pledged Revenues" shall mean the Sales Tax, less any mounts due or owing to the Comptroller as charges for collection or mmntion by the Comptroller for refunds andto redeem dishonored checks and drafts, to the extent such chuges and retentions are authorized or required by law. "Project" shall mean the Costs for the imlrcovement and enhancement of the Arena, as further described in the Project Agreement, for the specific purpose of the promotion and encouragement of employment and the public welfare. "Project Agreement" shall mean the Project .~ between the ].~suer and the City, dated as of August 1,2001, as amended. "Purchase Agreemem" means the bond purchase conuact between the Issuer and the Underwriters pertainm' g to the purchase of the Bonds by the Underwriters. ',Required Re, rye Amount" shall mean 1.00 limes the avoag~ annual principal and inlerest requirement of the Parity Bonds; provided, however, that the Required Reserve Amount shall not exceed 9 10 percent of the aggregate proceeds (within the meaning of Section 148(d)(2) of the Code) of the Parity "Reserve Fund Obligations" shall mean cash, Authorized Inveslments, and any Credit Facility (one or more), or any combination of the foregoing. "Rule" means SEC Rule 15c2-12, as mended from time to time. "Sales Tax" shall mean the one-eighth of one percent sales and use tax approved by the ciffzens of the City for the Arena at the November 7, 2000 election, and levied by the City within the boundaries of the City as they now or hereatter exist, together with any increases in the aforesaid rate if provided and authoriz~ by the laws of the Stme of Texas, including specifically the Act, and collected for the benefit of the Issuer and the Project, all in accurdance with the Act, including particularly Section 4A thereof. "SEC" means the United States Securities and Exchange Connnission. "Series 2001 Note" shall mean the Corpus Christi Business and Job Development Corporation Sales Tax Revenue Note, Taxable Series 2001 (Arena Project), currently outstanding in the aggregate principal amount of $5,000,000. "SID" means any person designated by the State of Texas or an authorized deparmaent, officer, or agency thereof as, and de~m~ined by the SEC or its staff to be, a state information depositorywithin the meaning of the Rule from lime to time. '~lYausfer Agreement" shall mean the Sales Tax Remittance Agrcement dated as of August 21, 2001, between the City and the Issuer. "Underwriters" means the syndicate of investment banking firms identified in the Purchase Agreement; RBC Dain Rauscher Inc. acts as senior managing underwriter. Section 7. PLEDGE. The Parity Bonds and any interest payable ~ are and shall be secutod by and payable from a first lien on aud pledge of the Pledged Revenues; and the Pledged Revenues are further pledged to the establishment and maintenance of the Debt Service Fund and the Reserve Fund as hereinatter provided, The Parity Bonds are and will be secured by and payable only from the Pledged Revenues and amounts on deposit in the Debt Service Fund and the Reserve Fund, and are not secured by or payable from a mortgage or deed of trust on any real, personal or mixed properties constituting the Project. Chapter 1208, Texas Government Code, applies to the issuance of the Bonds and the pledge of the Pledged Revenues granted by the Issuer under this Section, and such pledge is therefore valid, effective, and perfected. If Texas law is amended at anytime while the Bonds are out.qanding and unpaid such that 10 the pledge of the Pledged Revenues granted by the Issuer is to be subject to the filing requirements of Chapter 9, Texas Business & Commerce Code, then in order to preserve to the registered owners of the Bonds the perfection of the security interest in said pledge, the Issuer agrees to take such measures as it determines are reasonable and necessary under Texas law to comply with the applicable provisions of Chapter 9, Texas Business & Commerce Code and enable a filing to perfect the security interest in said pledge to occur. Section 8. REVENUE FUND. There heretofore has been created and established on the books o fthe Issuer, and accounted for separate and apart from all other funds of the Issuer, a special fund entitled the "Corpus ChiSsti Business and Job Development Coqpomtien Sales Tax Revenue Fund (Axena Project)" (hereinafter called the "Revenue Fund'). All Pledged Revenues shall be credited to the Revenue Fund immediately upon receipt. Monies in said Fund shall be maintained at the Depository Bank. Within the Revenue Fund the Issuer may establish an account for the purpose of depositing a portion of the Sales Tax, consistent with the proposition approved at the Election, for the payment of the costs of maintaining and operating the Project. The Issuer may fund any such account so established with Pledged Revenues after making the Wansfers required to be made in accordance with Sections 15, 16 and 17 hereof. The Issuer may withdraw and use, for any purpose not inconsistent with the proposition approved at the Election, any money in any such account so established to fund Costs of the Project for capitalimprovements, otto fund the Debt Service Fund orthe Reserve Fund; provided, however, that prior to making such withdrawal for the purpose of funding Costs of the Project for capital improvements, such withdrawal and the specific capital improvements to be funded with such money must be authorized and approved by official action of the goveming body of the City. Section 9. DEBT SERVICE FLrND. For the sole ptnpose of paying the principal ofandinterest on the Parity Bonds and any Additional Bonds, as the same come due, there is hereby created and established on the books of the Issuer a separate fund entitled the "Corpus Christi Business and Job Development Corporation Sales Tax Revenue Bonds Debt Service Fund (Arena Project)" (hereinafter called the "Debt Service Fund"). Monies in the Debt Service Fund shall be maintained at the Depository Banlc Section 10. RESERVE FUND. (a) There is hereby created and established on the books of the Issuer a separate fund entitled the "Corpus Christi Business and Job Development Coxporation Sales Tax Revenue Bonds Reserve Fund (Arena Project)" (hereinafter called the "Reserve Fund"). Reserve Fund Obligations deposited to the credit of the Reserve Fund shall be used solely for the purpose of retiring the last of any Parity Bonds as they become due or paying principal of and interest on any Parity Bonds when and to the extent the amounts in the Debt Service Fund are insufficient for such purpose. Reserve Fund Obligations deposited to the credit of the Reserve Fund shall be maintained at the Depository Bank. The Reseave Fund shall be maintained in an amount equal to the Required Reserve Amount. Subject to the provisions of Section 16 hereof, the chief fmancial officer of the Issuer may, at the option thereof, withdraw all smplus in the Reserve Fund over the Required Reserve Amount. 11 (b) The Issuer may satisfy its covenant to maintain the Reserve Fund in an amount equal to the Required Reserve Amount with a Credit Facility that will provide funds, together with other Reserve Fund Obligations, if any, credited to the Reserve Fund, at least equal to the Required Reserve Amount. The Issuer may replace or substitute a Credit Facility for all or a portion of the cash or Authorized InvesUnents on deposit in the Reserve Fund or in substitution for or replacement of any existing Credit Facility. Upon such replacement or substitution, cash or Authorized Investments on deposit in the Reserve Fund which, taken together with the face amount o f any existing Credit Facilities, are in excess of the Required Reserve Amount may be withdrawn by the Issuer, at the option of the chief financial officer of the Issuer, and transferred to the Revenue kh. tnd for completion of the Project (if bond proceeds are the source of such funds) or for other uses related to the Project as permitted by the t~,ns of the proposition approved at the Election; provided that at the option of the chief financial officer of the Issuer, the face amount of any Credit Facih'ty may be reduced in lieu of such transfer. (c) If the Issuer is required to make a withdrawal from the Reserve Fund for any of the purposes described in this Section, the chief financial officer of the Issuer, acting on behalf of the ~, shall proi~ly notify the issuer of such Cnxlit Facility of the necessity for a withdrawal from the Reserve Fund for any such proposes, and shall make such withdrawal FIRST from available moneys or Authorized Investments then on deposit in the Reserve Fund, and NEXT from a drawing under any Credit Facility to the extent of such deficiency. Should there be more than one provider of Credit Facilities that are on deposit in the Reserve Fund, the order of priority with respect to the drawings on such Credit Fadh'ties shall be determined by the Issuer and the providers of the Credit Facilities prior to any such drawings being (d) In the event there is a draw upon the Credit Facility, the Issuer shall reimburse the provider of such C'n~t Facility for such draw, in accordance with the terms of~my agreemen~ pursuant to which the Credit Facility is issued, from Hedged Revenues, however, such reimbursement from Pledged Revenues shall be subject to the provisions of Section 15 hereof and shall be subordinate and junior in fight of payment to the payment of principal of and pt~fium, if any, and inmrest on Parity Bonds. Section 11. CONSTRUCTION FUND. (a) There is hereby created and established on the books of the Issuer a separate fund entitled the "Corpus Christi Business and Job Dev¢lopmont Corporation Series 2002 ConsUuction Fund (AxonaProject)" (hereinafter called the "Consuuction Fund"). The Construction Fund shall be maintained at the Depository Bank and shall be subject to and cha~,ed with a lien in l~avor of the registered owners of the Bonds until said money on deposit tberein is paid out as herein provided. The proceeds from the sale of thc Bonds, other than any accrued interest and any capitalized interest (which shall be deposited to the credit of the Debt Service Fund), shall be credited to the ConsU'uction Fund together with such amounts reCluked to fund thc co~t of thc Project at%~ making required monthly deposits to the Debt Service Fund and Reserve Fund. All imemst and profits from investments made with money in the Construction Fund shall mnu~in on deposit in the Construction Fund and as part thereof. 12 CO) Money in the Construction Fund shall be subject to disbursement by the Issuer for payment of any Cost of the Project. Disbursements from the Cons~etion Fund shall be made by check signed by an officer of the Depository Bank on behalf of the Issuer. Such disbtusements shall be made only upon the submission of a request by the Issuer, approved by the City as provided in subsection (c) of this Section, and stating that said purpose for which the disbursement is requested constitutes a valid Cost of the Project. (c) The provisions of subsection CO) of this Section notwifihstanding, such officers and employees of the Issuer shall not have authority to request the disbursement of money from the Consu'uction Fund to pay any such Costs of the Project until the payment of such Co~ has been approved in writing by the chief flnar~ial officer of the City. Copies of invoices and statements with respect to a disbursement shall be subrdtted to the chief financial officer of the City for review thereby prior to the approval of said disbumement request. Section 12. TRANSFER. (a) Pursuant to the provisions of the Transfer Agreement, the City has agreed ~o do any and all things necessary to accomplish the h~fer of the Sales Tax collected for the benefit of the Issuer to the Revenue Fund on a monthly basis. The Transfer Agreement shall govern matters with respect to the collection of sales mx. es from the Comptroller, credits and refunds duc and owing to the Comptroller, and other matters with respect to the collection and refer of the Sales Tax. The City shall maintain the proceeds from the collection of the Sales Tax in a trust account separate from all other funds of the City, with such mst account to be maintained al an official depository bank of the City. Co) The Chak, person andthe Treasurer ofthe Board are hereby orderedto do any and allthin, gs necessary to accomplish the wansfer of monies to the Debt Service Fund in ample time to pay the principal of and interest on the Parity Bonds. Section 13. DEPOSITS OF PLEDGED REVENUES; INVESTMENTS. (a) The Pledged Revenues shall be deposited in the Debt Service Fund, the Reserve Fund and the Administrative Expense Fund as hereinal~ desc~'bed, when and as requh'ed by this Resolution. Co) Money in any Fund established by this Resolution may, at the option of the Board, be invested in Authorized Investments; provided that all such deposits and invesWaents shall have a par value (or market value when leas than par) exclusive of accrued imemst al all times at least equal to the amount of money credited to such Funds, and shall be made in such manner that the money required to be expended from any Fund will be available at the proper time or times. Money in the Reserve Fund shall not be invested in securities matming laler than the final maturity of the Parity Bonds. Such investments shall be valued in terms of current ma-ket value as of the last day of each year, except that direct obli~o.~rions of the l.h,.ited States (State and Local Govermnem Series) in beok-entxy form shall be continuously valued at their par or face principal amount Such investments shall be sold promptly when necessary to prevent any default in connection with the Parity Bonds. 13 Section 14. FUNDS SECURED. Money in all Funds mated by this Resolution, to the extent not invested, shall be secured in the manner prescribed by law for securing funds of the City. Section 15. DEBT SERVICE REQUIREMENTS. (a) Promptly ~ the delive~ of the Bonds, the Issuer shall cause to be lransferred to the Paying Agent/Regislrar and deposited to the credit of the Debt Service Fund any accrued interest or capitalized interest received from the sale and delivery of the Bonds, as described in the certificate delivered in accordance with lite provisions of Section 31 hereof, and any such deposit shall be used to pay lite interest next coming due on lite Bonds. (b) The Issuer shall transfer or cause to be transferred Pledged Revenues on deposit in the Revenue Fund, to the Paying Agent/Registrar for deposit to the credit of the Debt Service Fund the amoums, at the times, as follows: (1) Such mounts, deposited in approximately equal monthly insmlhnents on or before the 25th day of each month hereafter, c~ntaaencing with the month during which the Bunds are delivered, or the month therea~ if delive~ is made alter lite 25th day thereof, as will be sufficient, together with other amounts, if any, then en hand in the Debt Se~rice Fund and available for such purpose, to pay the interest scheduled to accrue and come due on the Bonds on the next succeeding interest paymem date. (2) Such amounts, deposited in approximately equal monthly installments on or before the 25th day of each month hereafter, commencing with lite mon& during which the Bunds are delivered, or the month thermfler if delivery is made ~er lite 25th day thereof, Fund and available for such propose, to pay lite principal scheduled to mature and come due on the Bonds on lite next succeeding principal payment date. Section 16. RESERVE REQUIREMENTS. When and so long as lite Reserve Fund Obligations in the Reserve Fund are not less than the Required Reserve Amonm, no deposits need be made to the credit of the Reserve Fund. When and if lite Reserve Fund contains less than the Required Reserve Ameunt dae to tbe issuance of the Bonds or any Additlunal Bonds, beginning on tbe 25th day of the month following the delivery of the Bonds to the Underwriters, and continuing for sixty months, lite Issuer shall transfer or cause to be Iransferred Pledged Revenues on deposit in the Revenue Fond, and deposit to the credit of lite Reserve Fund an amount equal to 1/60 of lite difference determined as of such delivery date between the amount in the Reserve Fund and the Required Reserve Amount. When and if the Reserve Fund at any time contains less than the Required Reserve Amount due to any cause or condition other than the issuance of any Additional Bonds, then, subject and subordinate to making the required deposits to the credit of the Debt Service Fund, such deficiency shall be made up as soon as possible fi'om the next available Pledged Revenues, or fix}m any other sources available for such purpose. The Issuer may withdraw and use, for any purpose relating to the Project not inconsistent with the provisions of the Act and the proposition approved at the Election, all surplus in the Reserve Fund over the Required Reserve 14 Amount; provided, however, that prior to making such withdrawal, such withdrawal and the use thereof must be authorized and approved by official action of the governing body of the City. In the event the Requinxi Reserve Amount is funded through the use ofa C~lit Facility, and the Credit Facility specifies a termination or expiration d~t~ that is prior to the final maturity of the Parity Bonds so secured thereby, the Issuer shall provide that su. ch Credit Facility shall be renemed at least twelve (12) months prior to the specified termination or expiration date or in the alternative provide that any deficiency that will result upon the termination or expiration of such Credit Facility will be accounted for either by (i) obtaining a substitute Credit Facility no sooner than twenty-four (24) months or no later limn twelve (12) months prior to the specified termination or expimtien date of the then existing Credit Facility or (ii) by dq:ositing cash into the Reserve Fund in no more than twenty-four (24) monthly installments of not less than one-twenty fourth (1/24th) of the amount of such deficiency on or before the 15th day of each month, commencing on the 15th day of the month which is twelve (12) months prior to such termination or expiration date, to restore the Debt Service Reserve Fund to the Required Reserve Amount. Section 17. ADMINISTRATIVE EXPENSE FUND. There is hereby created and established on the books of the Issuer, and accounted for separate and apart from all other funds of the Issuer, a special Irust fund entitled the "Corpus Christi Business and Job Development Corporation Sales Tax Administ~ve Expense Pund" (hemina.qer called the "Administrative Expense Fund'). Money in the Admir~trafive Expense Fund shall be maintained at the Depo~itop/Bank. After making the required transfers to the Debt Service Fund end the Reserve Fund (if necessary) in accordance with Section 1 ~ and 16 hereof~ for so long as any Parity Bonds are outstanding and unpaid, the Issuer shall Uansfer Pledged Revenues from the Revenue Fund in an amount not exceeding $15,000 per Fiscal Year into the A~dministralive Expense Fund. At no time shall the Admini~h~ive Expense Fund have an amount in excess of $15,000 on deposit therein. Money in the Administrative Expense Fund may be used to pay administrative and general expenses of the Issuer, including, without limitation, the expense of an annual audit, the fees and expenses of the Paying Agent/Registrar and any charges of the City for its adminb'uaiion of any of the Issuers affairs. Section 18. FINDING OF ECONOMIC DEVELOPIvlENT. The Issuer hereby fmde, based upon information provided to it by the City, that the Project will foster and enhance economic davelopiuont in the City, by providing a venue where ememinment and cultural activities that currently do not come to the City will be aii~ncted to and perfomaed in the City, thereby expanding the sales tax and hotel occupancy tax bases of the City, and providing employment opportunities to the cilizens of the City. Section 19. CONTINUING DISCLOSURE UNDERTAKING. (a) Annual _Reportq. (i) That the Issuer shall provide annually, within six months af~ the end of each Fiscal Year ending in or after 2003, fimwial information and opera, rig d_a_t ~ with respect to the Issuer of the general type described in Exlu'bit B bereW provided that such information and data is customarily t,mpared by the Issuer. Such information ~ be provided to any person upon request made to the Issuer provided that the Issuer reserves the right at any time to commence making such annual filings with the SID (if any, and ifnone, to each NRMSiR) in lieu of providing such information upon request. Any financial statements so to be provided shall be (1) 15 prepared in accordance with the accounting principles described in Exhibit B hereto, or such other accounting principles as the Issuer may be requinxt to employ from time to time pursuant to state law or regulation, and (2) audited, if the Issuer commissions an audit of such statements and the audit is completed wilhin the period during which they must be provided~ If the audit of such financial statements is not complcte within such period, then the Issuer shall provide unaudited financial statements by the required time and shall provide audited financial statements for the applicable Fiscal Yearto each NRMSIR and any SID, when and if the audit report on such statements become available. ('n) ffthe Issuer changes its Fiscal Year, it will notify the SID of the change (and of the date of the new Fiscal Year end) prior to the next date by which the Issuer otherwise would be required to provide financial infomaation and operating d_at~ p~t to this subsection (a). The financial information and operating data to be provided pursuant to this Section may be set forth in full in one or more documents or may be included by specific reference to auy document (including an official statement or other offering document, if it is available firrm the MSRB) that theretofore has been provided to the SID or filed with the SEC. (b) Mal~l~[Sm~.~li~. The Issuer shall notify any S]D and the MSRB, in a timely manner, of any of the following events with re~,_rx~'ct to the Bonds, ff such event is raaterial within tbe meening of the 1. Principal and interest payment delinquencies; 2. Non-paymem related defaults; 3. Unscheduled draws on debt service reserves reflecting financial difficulties; 4. Unscheduled draws on credit enhancements reflecting financial difficulties; 5. Substitution of credit or liquidity providers, or their failure to perform; 6. Adverse tax opinions or events affecting the tax -exempt status of the Bonds; 7. Modifications to fights of hoidins of the Bonds; 8. Bond calls; 9. Defeasances; 10. Release, substitution, or sale of property securing repayment of the Bonds; and The Issuer shall notify any SID and the MSRB, in a timely n~nner, of any ~ by the Issuer to provide financial information or operating data in accordance with subsection (a) of this Section by the time requked by such subsection. (c) Limitations. Disclaimers. ami Amanaql~-.q. (i) The Issuer shall be obligated to observe and perform the covenants specified in this Section for so long as, but only for so long as, the Issuer remains an "obligated person" with respect to the Bonds within the mean~g of the Rule, except that the Issuer in any event will give notice of any deposit made in accordance with this Resolution or applicable law Ih,at causes Bonds no longer to be Outstanding. 16 (ii) The provisions of this Section are for the sole benefit ofthe holders and beneficial owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or equitable fight, remedy, or claim hereunder to any other person. The Issuer undertakes to provide only the financial information, operating data, financial stateraonta, and notices which it has expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any other information that may be relevant or material to a complete pmsontation of the Issuegs financial results, condition, or prospects or hereby und~ake to update any information provided in accordance with this Section or otherwise, except as expressly provided herein. The Issuer does not make any mpresantation or warranty concerning such information or its usefulness to a decision to invest in or sell Bonds at any future date. (iii) UNDER NO CIRCUMSTANCES SHALL THE ISSUER BE LIABLE TO THE HOLDER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE ISSUER, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SEL-~ION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE. (iv) No default by the Issuer in observing or perfonning its obligations under this Section shall comprise a breach of or default under this Resolution for ~ of any other provision of this Resolution. Nothing in this Section is intended or shall act to disclaira, waive, or otherwise limit the duties of the Issuer under federal and state securities laws. (v) The provisions ofthis Section may be mended by the Issuer from lime to time to adapt to changed circumstances that arise from a change in legal requireme~ts, a change in law, or a change in the identity, nature, status, or type of operations of the Issuer, but only if (1) the provisions of this Section, as so amended, would have p~mfitted an underwriter to p~vchaso or sell Bonds in the primary offering of the Bonds in compliance with the Rule, taking into account any amendments or inteq,~ ~iai~ons of the Rule since. such offering as well as such changed circumstances and (2) either (a) the holders of a majority in aggregate principal amount (or any gr~er amount r~luired by any other provision of this Resolution that authorizes such an amendment) of the outstanding Bonds consent to such amendment or Co) a person that is unat:filiatlXl with file Isst~r (such as ilational]y l'~x~m~ i7~1 bond counsel) determines filat such Imaandmant will not mattaially impair file interest of file holders and beneficial owners of the Bonds. ffthe Issuer so amends the provisions ofthis Section, it shall include with arty amended financial information or operating data next provided in accordance with subsection (a) of this Section an explanation, in nmative form, of the reason for file amendment and of the impact of any change in file type of financial information or operating data so provided. The Issuer may also amend or repeal the provisions of this continuing disclosure agreement ffthe SEC amends or repeals the applicable provision of the Rule or a court of final juris~liction anters judgment that such provisions of the Rule are invalid, but only ff and to the exleat that the 17 provisions of this sentence would not prevent an underwriter fi'om lawfully purchasing or selling Bonds in the prima~ of~ of the Bonds. Section 20. PAYlVlENT. On or before March 1, 2003, and semiannually on or before each September I and March 1 thereatter while any of the Bonds are outstanding and unpaid, the Paying AgentYRegistrar shall make payment of the principal of and interest on the Bonds to the holders thereof with funds on deposit in the Debt Service Fund and the Reserve Pund (if necessary). Section 21. DEFICIENCIES; EXCESS PLEDGED REVENUES. (a) Ifon any occasion there shall not be sufficient Pledged Revenues to make the required deposits into the Debt Service Fund, the Reserve Fund and the Admini~ka[ive Expense Fund, then such deficiency shall be made up as soon as possble from the next available Pledged Revenues, or fi'om any other sources available for such purpose. (b) Subject to ~ the required deposits to the credit of the Debt Service Fund, the Reset, ye Fund and the Admlnimative Expense Fund, when and as required by this Resolution, or any resolution atahorizing the issuance of Additional Bonds, the excess Pledged Revenues may be used by the Issuer for any lawful purpose not inconsistent with the Act and the proposition approved at the Election. Section 22. ADDITIONAL BONDS. (a) The Issuer shall have the right and power at anytime and fi'om time to lime and in one or more series or issues, to authorize, issue and deliver additionalparity revenue bonds (he~in called "Additional Bonds"), in accordance with law, in any amounts, for purposes of financing of projects (including the Project) under the provisions of the Act, or for the purpose of refunding of any Parity Bonds or other obligations of the Issuer incurred in connection with the financing of projects (including the Project) under the provisions of the Act. Such Additional Bonds, if and when authorized, issued and delivered in accordance with this Resolution, shall be secured by and made payable equally and ratably on a parity with the Parity Bonds, and all other omstanding Additional Bonds, from a fa-st lien on and pledge of the Pledged Revenues. (b) That the Debt Service Fund and the Reserve Fund established by this Resolution shall secure and be used to pay all Additional Bonds as well as the Parity Bonds. However, each resolution under which Additional Bonds are/ssued ~hal! provide and require that, in addition to the amounts required by the provisions of this Resolution and the provisions of any other resolution or resolutions authorizing Additional Bonds to be deposited to the credit of the Debt Service Fund, the Issuer shall deposit to the credit of the Debt Service Fund at least such amounts as are required for the payment of all gth,¢ipal and interest on said Additional Bends then being issued, as the same come due; md that the aggregate amount to be accumulated and maintaJaed in the Reserve Fund shall be increased (if and to the extent necessary) to an amount not less titan the av~age annual principal and interest requirements of all Parity Bonds and 3dditional Bonds which will be outstanding at~ the issuance and delivery of the then proposed Additional Bonds; and that the requked additional amount shall be so accumulated by the deposit in the Reserve Fund of all or any part of said required ~dditional mount in cash immediately after the delivery of the then proposed Additional Bonds, or, at the option of the Issuer, by the deposit of said required additional 18 ~gnount (or any balance of said ~qui~d addi~onal amount not dq~osited in cash as permitted above) in monthly installments, made on or before the 25th day of each month following the delivery of the then proposed Additional Bonds, of not less than 1/60th of said required additional amount (or 1/60th of the balance of said required _additional amount not deposited in cash as l~mitted above). (c) That all calculations of average armual principal and interest requirements made pursuant to this section shall be made as of and from the date of the Additional Bonds then proposed to be issued. (d) No installment, series or issue of Additional Bonds shall be issued or delivered unless: (i) The Chaixperson and the Secretmy of the Board of the Issuer sign a written certificate to the effect that the Issuer is not in default as to any covenant, condition or obligation in connection with all outstanding Parity Bonds and Additional Bonds, and the resolutions authorizing same, and that the Debt Service Fund and the Reserve Fund each contains the amount then required to be (ii) The chief financial officer of the City signs a written certificate to the effect that, during either the next preceding Fiscal Year, or any twelve consecutive calendar month period ending not more than ninety days prior to the date of the then proposed Additional Bonds, the Pledged Revenues were at least equal to 1.25 times the annual principal and interest requirements (computed on a Fiscal Year basis) in the Fiscal Year in which such requirements are scheduled to be the greatest of all Parity Bonds and Additional Bonds to be outstanding after the issuance of then proposed Additional Bonds; and ('~') The gnveming body of the City by official action approves the issuance of the Bonds, as required by the Act. The foregoing notwithstanding, the Issuer may issue Additional Bonds, all or a portion of the proceeds of which are to be used to refund all of the outstanding Parity Bonds, without the necessity of satisfying the provisions of clause (ii) of ~ subsection. (e) The Issuer reserves the right to issue or incur Additional Bonds to pay any Cost of completing the Project for which the Bonds have previously been issued ("Completion Obligations'% Prior to the delivery of Completion Obligations, the Issuer must provide, in addition to all of the applicable certificates required by subsection (d) of this Section (othor than the certificates not required Urlder the circumstances descnbed below), the followin~ documents: a certificate of the consulting engineer engaged by the Isauer to design the Project stating that the Project has not materially changed in scope since the issuance of the Bonds and setting forth the aggregate Cost to be inctaxed to complete the 19 Project which, in the opinion of such consulting engineer, has been or will be incumxl; and a certificate of the chief financial officer of the City (A) stating that all amouras allocated to pay Costs of the Project from the proceeds of the Bonds were used or are still available to be used to pay Costs of the Project; (B) containing a calculation of the amount by which the aggregate Cost of the improvements necessaryto complete the Project (furnished in the consulting engineers certif~ate described above) exceeds the sum of the Costs ofthe Project paid to such date plus the moneys available at such date within any construction fund or other like account applicable to the Project plus any other moneys which the chief financial officer of the City, in the discretion thereof, has determined are available to pay such Costs in any other fund; and (C) Cel~fying that, in the opinion of the chief financial officer of the City, it is necessary for the Issuer to issue or incur the Completion Obligations to provide funds for the completion of the Project Anything herein to the conaary, the provisions of subsection (d)(ii) of this Section do not apply to Completion ObliL~ations if the aggregate pth~cipal amount of the Completion Obligations then to be issued does not exceed 15% of the aggregate prhacipal amount of the Bonds initially issued to pay the Cost oftbe Project. (f) Any installment, series or issue of Additional Bonds may be issued in such a manner that such Additional Bonds would ~mlify as obligaliolls described by Seetioll 103(a) of the Code. Section 23. GENERAL COVENANTS. The Issuer further covenants and agrees that in accordance with and to the extent required or permitted by law: to be paid tbe principal of and interest ou every Bond on the dates and in the places and manner prescribed in this Resolution andthe Bonds; and it will, atthe times and in the manner pn~scn'bed, deposit or cause to be deposited the amounts required to be deposited into the Funds created hereby; and any registered owner of the Bonds may n~quire the Issuer, its officials and employees to carry out, respect or enforce the covenants and obligations of this Resolution, by all legal and equitable means, including specifically, but without limitation, the use and filing of mandamus proceedings, in any corm of competent jurisdiction, against the Issuer, its officials and employees, or by the appointmem of a receiver in equity. Co) Lggiil. Altlllll~. It is a duly created and existing indusaial development corporation, and is duly authorized under the laws of the State of Texas, including the Act, to create and issue the Bonds; that all action on its part for the creation and issuance of the Bonds has been duly and effectively taken, and that 20 the Bonds in the hands of the registered owners thereof are and will be valid and enforceable special obligations of the Issuer in accordance with their terms. (c) Ei~lll~2Iaa~. It, while any Parity Bonds are outstanding and unpaid, will not additionally encumber the Hedged Revenues in any manner, except as permitted in this Resolution in connection with Additional Bonds, unless said encumbrance is made junior and subordinate in all respects to the liens, pledges, covenants and agreements of this Resolution; but the right of the Issuer to issue revenue bends payable from a subordinate lien on the Hedged Revenues, in accordance with the provisions of the Act, is specifically recognized and retained. (d) ' ' It, while any Parity Bonds are outstanding and unpaid, will not sell, convey, mortgage, encumber, lease or in any manner transfer rifle to, or otherwise dispose of the Project, or any significant or substantial part thereof, without the approval of the governing body of the City. (e) ~ (i) The Issuer hereby confimas the eaflier levy by the City ofthe Sales Tax at the rote voted at the Election, and the Issuer hereby warrants and represents that the City has duly and lawfully ordered the imposition and collection ofthe Sales Tax upon all sales, uses and Iransactinns as are permitted by and described in the Act throughout the boundaries of the City as such boundaries existed on the date of the Election and as they may be expanded fl~m time to lime. ('u) For so long as any Parity Bonds are outstanding, the Issuer covenants, agrees and wammts to take and pumue all action p~ndasible under applicable law to cause the Sales Tax, at said rate or at a higher rate if permitted by applicable law, to be levied and collected continuously, in the mariner and to the maximum ex'lent permitted by applicable law, and to cause no nxlaction, abatement or exemption in the Sales Tax or rate of tax below the rate stated, con_finned and ordered in clause (i) of this subsection to be ordered or permitted so long as any Parity Bonds shall remain outstanding. (iii) If the City shall be authorized hereafter by applicable 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, the Issuer, to the extent it legally may do so, hereby covenants and agrees to use its best efforts to cause the City to take such action as may be required by applicable law to subject such taxable items or transactions to the Sales Tax. (iv) The Issuer ag~es to take and pursue all action permissible under applicable law to cause the Sales Tax to be collected and remitted and deposited as herein required and as required by the Act, at the earlieat mad most frequent times permitted by applicable law. (v) The Issuer agrees and covenants at all times to use its best efforts to cause the City to comply with the Transfer Agreement and the Project Agreement. 21 (f) Records. Itwillkeepproperbooks ofrecord and account in which full, tmeandcorrect entries will be m~o. of all dealings, activities and mmsactions relating to the Project, the Pledged Revenues and the Funds mated pursuant to this Resolution, and all books, documents and vouchers mia'dug thereto shall at all reasonable times be made available for inspection upon request of any bondholdem. (g) ~. It will maintain its corporate existence during the time that any Parity Bonds are outstanding hereunder. Section 24. DEFEASANCE OF BONDS. (a) ~. That any Bond and the interest thereon shall be deemed to be paid, retired and no longer Outstanding (a "Defeased Bond"), except to the extent provided in subsection (d) of this Section, when paymem oft_he principal of such Bond, plus interest thereon to the due date (whether such due date be by mason of maturity or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof, or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying AgenffRegistrar in accordance with an escrow agreement or other similar inStl~ment (the "Fllttlre ESC~w Agreement') for such payment (1) lawful money of the United Sta~ of America sutticiem to make such payment or (2) Defeasmme Securities that mature as to principal and interest in such mounts and at such times as will insure the availability, without reinvestrnent, of sufficient money to provide for such payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be deemed to be a Defcased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the Pledged Revenues, and such principal and interest shall be payable solely from such money or Defeasance Securities. Notwithstanding any other provision of this Resolution to the conlrary, it is hereby provided that any determination not to redeem Defeased Bonds that is made in conjunction with the payment arrangements specified in clauses · or (ii) above shall not be irrevocable, provided that, in the lnr~cedings providing for such payment ammgemems, the Issuer extxessly reserves the right ( 1 ) to call the Defeased Bonds for redemption; (2) to give notice of the reserv~on of that right to the ownem of the Def~ased Bonds hmuediately following the making ofthe payment anangements; and O) to direct that notice of the reservation be included in any txxtemplion notices that it anthorizes. limes as hereinbefore set forth, and all income from such Defeasance Securities received by the Paying AgenffRegistmr that is not required for the payment of the Bonds and interest thereon, with respect to which such money has been so deposited, shall be turned over to the Issuer, or deposited as directed in wtilh~g by the Issuer. Any Future Escrow Agreement pmsuam to which the money and/or Defeasance Securities are held for the payment of Defeased Bonds may contain provisions petmi~ the invesunent or reinvesUnent of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the requh~ments specified in subsections (aXi) or (ii) of this Section. All income from such Defeasance Securities received by the Paying Agent/Registrar which is not required for the 22 payment of the Defeased Bonds, with respect to which such money has been so deposited, shall be remitted to the Issuer or deposited as directed in writing by the Issuer. (c) Paving _Agen~_cqstrar Servig~. Until all Defeased Bonds shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/l~gis~ar for such Defeased Bonds the same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Resolution. (d) SelectionofBonds for D~f~a~qanee. In the event that the Issuer elects to defease less than all of the talucip~ amount of Bonds of a maturity, fl'e Paying Agent/Regislrar shall select, or cause to be selected, such amount of Bonds by such random method as it deems fair and appropriate. Section 25. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS. (a) ~. In the event any outstanding Bond is danmged, mutilated, lost, stolen, or desu:oyed, the Paying Agent/Registrar shall cause to be tninied, executed, and delivered, a new bond of tho same principal amount, maturity, and interest rote, as the damaged, mutilated, lost, stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided. (b) _Application for Reolacement BOnd~ Application for replacement of damaged, mulilal~xl, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying AgenvRegistmr. In every case of loss, thett, or destruction of a Bond, the registered owner applying for a replacement bond shall furnish to the lssaer and to the Paying AgenVRogislrar such security or indenmity as may be required by them to save each of them hamfleas from any loss or damage with respect thereto. Also, in every case of loss, theK or destruction of a Bond, the registered owner shall furnish to the Issuer and to the Paying Agont/Regiswar evidence to their satisfaction of the loss, theft, or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or mutilated. (c) ~[~I)~]LQgliI~ Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has oucumM which is then continuing in the payment of of the ~une (without surrender thereof except in the ease of a damaged or mutilated Bond) instead of (d) Cha~_ for Issuing Replacement Bgn,l~. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge ~he reglste~ owner of such Bond with all legal, v, h,~g, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be emitled to all the benefits of this Resolution equally and proportionately with any and all other Bonds duly issued under this Resohlion. 23 (e) Authority for Issuing R~_lacemem Bonds. In accordance with Chapter 1206, Texas Government Code, this Section shall constitute authority for the issuance of any such replacement bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/Regisirar, and the Payin~ AgeniRe~ shall authenticate and deliver such Beads in the form and manner and with the effect, as provided in Section 4(d) of flxis Resolution, for Bonds issued in conversion and exchange for other Bonds. Section 26. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION; CUSIP NUMBERS AND BOND INSURANCE, IF OBTAINED. The Chairperson of the Board of the Issuer is hereby authorized to have control of each Bond issued hereunder and all necessary records and proceedings penainm' g to each Bond pending theft delivery and their ~ examination, and approval by the Attorney General of the Slate of Texas, and their registration by the Comptroller of Public Accounts of the State of Texas. Upon regislmtion of each Bond said Cohigholler (or a deputy designated in writing to act for said Comptroller) shall raenuslly sign the Comptroller's Regisltation Certificate on each Bond, and the seal of said Comptroller shall be impressed, or placed in faosimile, on each Bond. The apg~t,vin~ legal opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the option of the Issuer, be printed on each Bond or on any Bonds issued and delivered in conversion of and exchange or ~phcement of any Bond, but neither shall have any legal effect, and shall be solely for the convenience end information of the registered ownem of the Bonds. In addilion, the form of bond counsel's opinion relating thereto, and an appropriate statement of insurance supplied by a municipal bond insu~m~ce company providing insurance, if any, coverin~ all or any pan of the Bonds may be printed or attached to the Bonds. Section27. COVENANTS REGARDING TAXEXEMPTION. That the Issuer intends to issue the Bonds as tax-exempt obligations, and to that end hereby covenants to refrain bom any action which .would adve~ely affect, or to rake any action to assure, the treatment of the Bonds as obligations descn3ed m section 103 of the Code, the interest on which is not includable in &e "gross income" of abe holder for purposes of federal income taxation. In furtherance thereof, the Issuer covenants as follows: (a) to take anY aedon to assure that no more tlma 10 pereont ofthe proceeds of the Bonds or the projects fin~ced therewith (less amounts deposited to a reserve fund, if any) are used for may "priv~ business use", as defined in section 14 l(bX6) of the Code or, if more than 10 percent of the proceeds are so used, that amoums, whether or not received by the Issuer, with respect to such private business use, do not, under the tc~ms of this Resolution or any uaderlying m'rangement, directly or indirectly, secure or provide for the payment of more than 10 percent of the debt service on the Bonds, in conm~vention of section 141(b)(2) of the Code; (b) to take any action to assure tha in the event that the "private business use" described in subsection (a) hereof exceeds 5 percent of the proceeds of the Bonds or the projects 24 fmanced therewith (less ~xaounts deposited into a reserve fund, if any) then thc amount in excess of 5 pcreant is used for a '~rivute business use" which is "related" and not "disproportionate'', within thc meaning of section 141(b)(3) of the Code, to thc governmental use; (c) to take any action to assure that no amount which is g~atex than the lesser of $5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve fund, if any), is directly or indirectly used to finance loans to persons, other than state or local governmental units, in contravention of section 141(c) of the Code; (d) to refrain from taking any action which would otherMse result in the Bonds being treated as "private activity bonds" within the meaning of section 141 (a) of the Code; (e) to refrain fium taking any action that would result in the Bonds being "foderally guaranteed" within the meaning of section 149(b) of the Code; (f) to refrain from using any portion of the proceeds of the Bonds, directly or indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire investment property (as defined in section 148COX2) of the Code) which produces a materially higher yield over the term of the Bonds, other than investment property acquired with - (1) proceeds of the Bonds invested for a reasonable temporary period for ctmr~a refundin_g of 90 days or less or advance refunding of 30 days or less until such proceeds are needed for the propose for which the bonds are issued, (2) amounts invested in a bona fide debt service fand, within the meaning of section 1.148-1(b) of the Treasury Regulations, and (3) amoums deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed 10 percent of the proceeds of the Bonds; (g) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene the mquh~ments of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (rehti~ to advance refundings); and (h) to pay to the United States of America at lesst once during each five.year period Coe~h~;ng on the date of delivery of the Bonds) an amount that is at least equal to 90 percent of the "Excess Earnings", wiflxin the meaning of section 148(0 of the Code and to pay to the United States of America, not later than 60 days after the Bonds have been paid in full, 100 percent of the mount then required to be paid as a result of Excess Earnings under section 148(0 of the Code. 25 Reg~10~ions and, in the case of a refunding bond, mmsferred proceeds (if any) and proceeds of the refunded bonds expended prior to the date of the issuance of the Bonds. It is the understanding of the Issuer that the covenants contained herein are intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S. Department of the Treasury pursuant thereto. In the event that regulations or rulings are hereatter promulgated which modify or expand provisions of the Code, as applicable to the Bends, the Issuer will not be required to comply with any covenant contained herein to the extent that such failure to comply, in the opinion of nationally-recognized bond counsel, will not adversely affect the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In the event that regulations or rulings are hereal'ter promulgated which impose additional requirements which are applicable to the Bonds, the Issuer agrees to comply with the additional requh~ments to the extent necessaxy, in the opinion ofnationally-re, eogn~ iTed bond counsel, to preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In furtherance of the foregoing, the Chairperson, the Vice Chaixperson or the Treasurer may execute any certificates or other reports required by the Code and to make such elections, on behalf of the Issuer, which may be pemdtted by the Code as are consistent with the propose for the issuance of the Bonds. In order to facililate compliance with the above chuse {h), a "Rebate Fund" is hereby established by the Issuer for the sole benefit of the United States of America, and such Rebate Fund shall not be subject to the claim of any other person, including without limitation the registered owners of the Bonds. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code. Section 28. ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE PROJECT. That the Issuer covenants to account for on its books and records the expenditure of proceeds from the sale of the Bonds and any investment earnings thereon to be used for paying the Costs of the Project in accordance with the requh~ments of the Code. The Issuer recognizes that in order for the proceeds to be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18 months of the later of the date that (a) the expenditure on a Project is made or(b) each such Project is completed; but in no event hter than ~ years after the date on which the original expenditure is paid. The foregoing notwithsmding, the Issuer recogn~ ires that in order for proceeds to be expended under the Code, the sale proceeds or investment eamln~ must be expended no more than 60 days after the earlier of (a) the fir& annivenary of the dste of initial delivery of the Bonds or (b) the d~e the Bonds are retired. The Issuer agrees to obtain the advice of a natinnally-recognized bond counsel if such expenditure falh to comply with the foregoing to assure that such expenditure will not adversely affect the m-exempt stares of the Bonds. For purposes of this Section, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion of a natienally-recognized bond counsel to the effect that .such failure to comply will not adversely affect the excludability for federal income tax purposes from gross mcorae of the intenm Section 29. DISPOSITION OF PROJECT. That the Issuer covenants that the property constitutin4g the Project will not be sold or otherwise dispo~xl in a transaction resulting in ~he receipt by the Issuer of cash or other coaipensation, unless the Issuer obtains an opinion of a nationally-recognized bond 26 counsel substantially to the effect that such sale or other disposition will not adversely affect the tax-exempt status of the Bonds. For p~ of this Section, the portion of the property comprising personal property and disposed of in the ordinary course of business shall not be treated as a transaction resulting in the receipt of cash or other conapensatior[ For proposes of this Section, the Issuer shall not be obligated to comply with this covenant if it olmins an opinion of a nationally-recognized bond counsel to the effect that .such failure to comply will not adve~ely affect fl~e excludability for federal income tax purposes from gross mcome of the interest. Section 30. SALE OF BONDS. (a) ~l.~Ll~. The sale of the Bonds to the Underwriters is hereby authorized. The Bonds shall be sold to the Underwriters at such price, and subject to such terms and conditions as set forth in the Purchase Ag~ement, as shall be determined by the Executive Director pmsuam to subsection (b) below. The Executive Director, acting for and on behalf of the Issuer, is authorized to enter into and carry out the Purchase Agreement with the Undem, riters, in substantially the form attached he.to and made a part hereof for all purposes, with such changes as may be necessary to effect the sale of the Bonds to the Undemrff~. The authority of the Executive Director to execute the Purchase Agreement shall expire if the Purchase Agreement has not been executed by the Issuer and by the Underwriters (acting through their duly designated representative) by 5:00 p.m., Friday, December 27, 2002. One Bond in the principal amount maturing on each maturity dale as set forth in the Purchase Agllxmlellt ~;hal! be delivered to the Ulld~-wfite~, and the Underwritc~ shall have the fight to exchallge such bonds as provided in Section 4 hereof without cost (b) Parameters with Respect_ to Execution of Pureha~ A~ent. The Executive Director is hereby authorized, appointed, and clesignaled to act on behalf of the Issuer in selling and delivering the Bonds and carrying out the other procedures specified in this Resolution, including detemiining and fixin~ the date of the Bonds, any additional or different designation orfifle by which the Bonds shall be known, the aggregate principal amount of the Bonds, the date of dellver¢ of the Bonds, the price at which the Bonds will be sold, the yeats in which the Bonds win rp.a~e, the to,'.,cipal amount of Bonds to mature in each of such years, the rote of interest to be borne by each such maturity, the interest payment periods, the dates, price, and terms upon and at which the Bonds shall be subject to redemption prior to maturity at the option of the Issuer, as well as any mandatmy sinking fund nxlemption p~u,qsions, and all other matters relating to the issu~mce, sale, and delivery of the Bonds and the refunding of the Series 2001 Note, including, wilhout limila11'ofl, obtaining a municipal bond insurance policy and a debt service reserve fund smety bond in support of the Bonds, all of which shal~ be specified in the Purchase Agreement; provided, that (i) the price to be paid for the Bonds shall not less than 95% of the agg~g~ ori~nal p, hcipal amount thereof, plus accrued interest thereon from the date of their delivery, (ii) none of the Bonds shall bear imerest at a rate greater than 10% per annum and (iii) none of the Bonds shall mature after March 1, 2026. (c) ~. The "Official Statement" prepared in connection with the sale of the Bonds, in subs~nfially the form attached to this Resolution, is hereby accepted, approved and authorized to be delivered in executed form to he Undenvriters. The use of he "Ptelimlr~,y Official Statement" prepoa~ in connection with the sale of the Bonds is hereby ratified. 27 (d) Bond Insurance and Reserve Fund Ins~wance Policies. Should the Purchase Agreement so provide, on the date of delivery of the Bonds, the Issuer will obtain from the municipal bond insurance company identified in the Purchase Agreement (the "Insurer") a municipal bond insurance policy and a debt service reserve fund policy in support of the Bonds. The Board hereby represents that any debt service reserve fund policy to be obtained from the Insurer shall be in an mount equal to the Required Reserve Amount for the Bonds. To that end, for so long as said policies are in effect, the requirements of the Insurer, as a condition to the issuance of said policies, a~ incorporated by reference into this Resolution and made a part hereof for all purposes, notwithstanding any other provision of this Resolution to the contrary. The Executive Director is hereby authorized to execute any agreements or other instruments in connection with obtaining any such policy. Section 31. USE OF BOND PROCEEDS. The proceeds from the sale of the Bonds, other than costs of issuance paid in accordance with an instruction letter of the Issuer, shall be deposited to the credit of the various Funds created by this Resolution as set forth in a certificate to be delivered to the Paying Agent/Registrar at closing. Bond proceeds temaleing after the completion of the Project either mall be deposited to the credit of the Debt Service Fund or shall be used to purchase Bonds in the open market. Section 32. EXECUTION OF DOCKS. The Chaiqaerson, the Vice Chairperson, the Executive Director and the Secretary of the Board ofthe Issuer are hereby authorized to execute, deliver, atteat and affix the seal of the Issuer to all documents and imtnm~nts necessary and appropriate in connection with the issuance, sale and delivery of the Bonds, including, without limitation, the Paying ~ Agreement and the documentation required to obtain the policies from the Insurer described in Section 30(d) above, including, without lflnitafion, any agreement between the Issuer and the Insurer to effect the delivery of a Cr~t Facility which constitutes a Reserve Fund Obligation. The Chairperson, the Vice Chairperson, the Executive Director and the Secretary of the Board of the Issuer, and all other officers, employees, and agents of the Issuer, and each of them, shall be and they are hereby expressly authorized, en'qxnvered, and directed from time to time and at any time to do and perform all such acts and things and to execute, aclmowledge, and deliver in the name and under the corporate seal and on behalf of the Issuer all such inslruments, whether er not herein mentioned, as may be necessary or desirable in order to carry out the tonns and provisions of this Resolution, the Bonds, the sale and delivery of the Bonds and fixing all details in connection therewith, and to approve any Official Statement, or Section 33. REASONS FOR REFUNDING. The Issuer is effecting the refunding ofthe Series 2001 Note pursuant to authority graraa~d under the Act. The Board of Direetors hereby determines that it is in the best interests of the Issuer to refund the Series 2001 No~e for the following reasons. The Series 2001 Note was issued an obligation that was not described in section 103 of the Code, with the intention of refinancing the Series 2001 Note into long-term obligations that, to the maximum extent poss~le, would qualify as obligations described in section 103 of the Code. The issuance of the Bonds effects the convemion of short-term financing into long-tram, tax-exempt financing, as was originally inlended when the Series 2001 Note was issued, thereby enhancing the cash flow of the Issuer. 28 Section 34. RULES OF CONSTRUCTION. For all purposes of this Resolution, unless the context requires otherwise, all references to designated Sections and other subdivisions ate to the Sections and other subdivisions of this Resottrdon. The words "herein", "hereof' and "hereunder' and other words ofshnilar import rear to this Resolution as a whole and not to any paxticular Section or other subdivision. Except where the context otherwise requires, tern~s defined in this Resolution to impart the singular number shall be considemt to include the plural number and vice vetsa~ References to any named person means that party and its successors and assigns. References to any constitutional, statutory or regulatory provision means such provision as it exists on the date this Resolution is adopted by the Issuer and any future amendments thereto or successor provisions thereof. Any reference to the payment of principal in this Re~lution shall be deemed to include the payment of any ma~d~ory sinking fund redemption payments. Any refeaence to FORM OF BOND shall refer to the form attached to this Resolution as Exhibit A. 29 EXIt]BIT A NO. UNITED STATES OF AMERICA STATE OF TEXAS CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING AND IMPROVEMENT BOND, SERIES 2002 (ARENA PROJECT) Date of !~]l~giaalj~ Cusip NO, October 15, 2002 REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS ON THE MATURITY DATE specified above, CORPUS CHRISTI BUSINESS AND/OB DEVELOPMENT CORPORATION (the "Issuer"), being a nonstock, nonprofit industrial development corporation organized and ex[~ng trader file laws of file State of Texas, including particularly file Development Corporation Act of 1979, A~ticle 5190.6, V~.T.C.S., as amended (the "Act"), and acting on behalf of file City of Corpus Christi, Texas (the "City'S, hereby promises to pay to the registered owner set forth above or to the assignee or assignees thereof (either being hereinafter called file "registered ownS') the principal amount set forth above, and to pay intexest thereon from the date of the original issue specified above, to file maturity date specified above, or the date of redemption prior to maturity, at the interest rate per annum specified above with imerest being payable on March 1, 2003 and semiannually on each September 1 and March I thereafter; except that ff file ~d.~-_. e of authentication of this Bond is later than the first Record Date (hereinat~r defined), such principal mnount shall bear imerest from file interest payment date next preceding the date of authentication, unless such da~e of authentication is afar any Record Date but on or before file next following interest payment date, in which case such p~h~cipal amount shall bear interest from such next following interest payment date. THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of file United States of America, without exchange or collection charges. The principal ofthis Bond shall be paid to the registered owner hereof upon presentation and sunvnder of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at file corporate trust office in Dallas, Texas (file "Designated Trust Office'~ of JPMorgan Chase Bank, which is file "Paying Agent/Re~aar~" for this Bond. The payment of .interest on this Bond shall be made by file Paying Agenl/Re~sttar to file registered owner hereof on file interest payment date by check or draf~ dated as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely fir~n, funds of file Issuer required by the resolution authorizing the issuance of the Bonds (',he "Resolution") to be on deposit with the Paying A_gen~Regis~rar for such purpose as hereinaO~ provided; and such check or cYa~ shall be sent by the Paying Agent/Regatta by United States mail, first class postage l~repaid, on each such inte~st payment date, to the registered owner hereof, at the address of the registered owner, as it appeared on the 15th day of the month next preceding such date (the "Record Date") on the Registration Books kept by the Paying Agent/Regislrar, as hereinafter described. Any accrued interest due upon the redemption of this Bond prior to maturity as provided herein shall be paid ~ the registered owner at the Designated Tms~ Office of the Paying Agent~egisWar upon presentation and surreader of this Bond for redemption and payment at the Designated Trust Office of the Paying AgonVRegiswar. The Issuer covenants with the registered owner of this Bond that on or before each principal payment d~pte, interest paymem date, and accrued interest payment date for this Bond, it will make available to the Paying Agent/Registrar, from the "Debt Service Fund" created by the Resolution, the amounts required to provide for the payment, in immedia~ly available i~m,ta, of all ~nhtcipal of and inte~ on the Bonds, when due. In addition, interest may be paid by such other method, acceptable to the Payin~ Agent/Re~s~, requested by, and at the risk and expense of, the registered owner. Inthe event of anon- payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such in~erest payment (a "Special Record Date") will be established by the Paying Ag~tit~Registrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days m%r the Special Record Date) shall be sent at least five business days prior to the special record date by the United States mail, first-class postage prepaid, to the address of each owner of a Bond appem-ing on the Regisuation Books at the close of business on the last business day next preceding the date of mailing of such notice. IF THE DATE for the payment of the principal of or imerest on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which bank/ng institutions in the city where the Designmed Trust Office of the Paying Agent/Registrar is located are authorized by law or executive order to dose, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which 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 paymont was due. Notwithstanding the foregoing, during any period in which ownerahip of the bonds of~ Series is detej~alned only by a book enu~ at a securities depository therefor, any paymem to the securities depository, or its nominee or registered assigns, shall be THIS BOND is one of an issue of Bonds initi~y da~ed the dine of original issue spec/fled on the face of this Bond, authorized in accordance with the Comfimtion and laws of the State of Texas, including particularly the Act, in the ori~nal principal amount of $ for the purpose of (i) cons~u~g, equipping, opora~g and maintaining, or causing to be acquired, constructed, equipped, opiated and mainmirted the Project, (ii) refunding the Series 2001 Note, and 0ii) payin~ other co~s associated with the purposes described in clauses (i) and (ii), for the specific purpose ofthe promotion and oneouragement of employment and the public welfare. ON SEPTEMBER 1, 2012, or any date thereafter, the Bonds of this Series maturing on md after September 1,2013 may be redeemed prior to their scheduled maturities, at the option of the Lssuer, with funds derived from any ava!l~ble source, as a whole, or in part, and, if in part, the maturity or maturities of Bonds and the amounts thereof, to be redeemed shall be selected and designated by the Issuer, and the Issuer shall direct the Paying Agent/Registrar to call by lot Bonds, or portions t~reofwithin such ma~des .and in such pchicipal mounts, for nxleroption (provided that a portion of this Bond may be redeemed only .m an integral multiple of $5,000), at the nxlen~on price of the principal amount thereof, plus accrued interest to (but excluding) the date fixed for redemption; provided, that during any period in which ownership of the Bonds is determined only by a book ent, y at a securities depository for the Bonds, if fewer than all of the Bonds of the same maturity and bearing the sarae interest rate are to be redeemed, the pa~icular Bonds of such maturity and bearing such interest rate shall be selected in accordance with the arrangements between the Issuer and the securities depository. THE BONDS are also subject to mandatory redemption in part by lot pursuant to the terms oftha Resolution, on September i, 20__, with respect to Bonds maturing September 1, 20__, and on September 1, 20 , with respect to Bonds maturing September 1, 20 , in ~e following years and in the following amounts, at a price equal to the principal amount thereof and aeorued and unpaid interest to (but excluding) the date ofnxlemption, without iJmafium: * F~al Matmty The principal amoum of the Bonds subject to sinking fund redemption requixed to be redeemed on any mandatory sinking fund mdemlXion date .qhal! be relluced at the option of the Issuer by the prlucipal amount of such Bonds which, at least filly (50) days prior to the mandatory sinking fund rederalxion date, shall have been acquired by the Issuer, and delivered to the Paying Agent/Registrar for cancellation or ~qha/l have been redeemed pursuant to the optional redemption provisions of this Bond and not previously credited to the mandatory sinking fund redemption; provided, that dining any period in which ownership of the Bonds is determined only by a book enlry at a securities depositmy for the Bonds, the particular Bonds to be called for mandatory redemption shall be selected in accordance with the anungements between the Issuer and the securities depository. THE BONDS shall be subject to exttaontinary optional redemption by the Issuer, in whole or in paxt (provided that a portion of this Bond may be redeemed only in an integral multiple of $5,000) at any time or from time to time at a redemption price equal to the p~hLcipal amount thereof plus accrued interest, if any, to (but excluding) the nxtempfion date, without premium, if the Issuer has delivered to the City an opinion of a law finn selected by the Issuer with nationally recoL3ni~gxl standing with respect to section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), addressed to the Issuer and the City substantially to the effect that (i) a failure to redeem Bonds (or the relevant portion thereof) may adversely affect the exclusion of interest on the Bonds from the grrr~s income of the holders under section 103 of the Code and (ii) redemption of the Bonds in the amount set forth in the opinion (but in no smaller mount than set forth in such opinion) would permit the continuance of any exclusion so afforded under section 103 of the Code. AT LEAST 30 days prior to the date fixad for redemption, written notice of such redemption shall be given by the hying Agent/Regisu~ by United States mail, f~st class postage prepaid, to the registered owner of each Bond to be redeemed at its address as it appeared on the books of the Paying AgenvRegistrar on the forty-fifth day prior to the date fixed for redemption. The failure to receive such notice in writing, or any defect therein, or in the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedin~ for the redemption of Bonds. By the date fixed for any such redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the required redemption pnee for the Bonds which are to be so redeemed, plus accrued interest thereon to the date fixed for redumption~ If such notice of redemption is given and if due provision for such payment is made, all as provided above, the Bonds which are to be so redeemed thereby automatically shall be txeated as redeemed prior to their scheduled maturities, and they shall not bear interest allow the date fixed for redemption, and they shall not be regarded as being outstanding except for the tight of the registered owner to receive the redemption price plus accrued interest from the Paying Agent/Registrar out of the funds provided for such paymem. ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Resolution, this Bond, or any unredeemed portion hereof, may, at the request of the registered owner or the assignee or assignees hereof, be assigned, transfet~ and exchanged for a like aggregate principal anaount of fully r~gistemd Bonds, without interest coupons, payable to the appropriate registered owner, assignee or assignees, as the case may be, having the same denomination or denominations in any integral multiple of $5,0(10 as requested in writing by the appropriate registered owner, assignee or assignees, as the case may be, upon smt~uder of this Bond to the Paying Agent/Regimar for cancellation, all in accordance with the form and procedures set forth in the Resolution. Among other requirements for such assignment and ha~st~', this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper insmmaents of assignment, in form and with guarantee of signatures satisfactory to the Paying Ageal/Registrar, evidencing assignment of this Bond to the assignee or assignees in whose name or names this Bond or ~ such portion or portions hereof is or are to be translated and registere& The form of Assignment printed or endomed on this Bond shall be executed by the registered owner or its duly authorized attorney or representative to evidence the assignment hereof. The Issuer shall pay the Paying Agent/Registrars standard or customary fees and chaxges for making such traa.st~r, but the one requesting such mmsfer shall pay any taxes or other governmental charges required to be paid with ~peet thereto. The Paying Agont/Regis~ shall not be required to make mmsfe~s of regis~afion of this Bond or any pordon hereof (9 during the period con;aaencing with the close of business on any Record Date and ending with the opening of business on the next following principal or inte~ payment date, or, (ii) with ~espeet to any Bond or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date. The registered owner of this Bond shall be deemed and treated by the Issuer and the Paying AgnnffRegistmr as the absolute owner hereof for all proposes, including payment and discharge of liability upon this Bond to the exlent of such payment, and the Issuer and the Paying Agent/Registrar shall not be affected by any notice to the conln~ry. IN THE EVENT any Paying AgenffRegistrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Resolution that it promptly will appoint a competent and legally qualified substitute therefor, and promptly will cause written notice thereof to be mailed to the registered owners of the Bonds. BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the tenm and pn~tisions of the Resolution, agrees to be bound by such terms and provisions, acknowledges that the Resolution is duly recorded and available for impection in the official minutes and records of the governing body of the Issuer, and agrees ltmt the terms and provisions of this Bond and the Resolution constitute a contract between each registered owner hereof and the Issuer. WHENEVER the beneficial owneeship of this Bond is determined by a book entry at a securities depository for the Bonds, the foregoing requh~ments of holding, delivering or ~nsfe/'t'h~g this Bond shall be modified to require the appropriate person or entity to meet the requixements of the securities depository as to registering or transferring the book entaS' to produce the same effect. IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly authorized, issued, sold, and delivered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been performed, existed, and been done in accordance with law; tl~at this Bond is a special obligation of the Issuer; that neither the State of Texas, the City, nor any political COlporation, subdivision, or agency of the State of Texas, nor any member of the Board of Directors of the Issuer, either individually or collectively, shall be obligated to pay the principal of or the imerest on this Bond and neither the faith and credit nor the taxing power (except as described below) of the State of Texas, the City, or any other political coqxa, ation, subdivision, or agency thereof is pledged to the payment of the principal of or the ~ on this Bond; that the ~,fiacipal of and interest on this Bond, together with outstanding bonds of the Issuer similarly secured, are secured by and payable from a first lien on and pledge of certain funds ereated under the Resolution and the revenues defined in the Resolution as the "Pledged Revenues", which include the proceeds of a one-eighth of one percent sales and use tax levied for the benefit of the Issuer by the City for the Arena project (the "Sales Tax") pursuant to Section 4A of the Act; and that the registered owner hereof shall not have the right to demend payment of the pfineipal of or inten~t on this Bond from any tax proceeds other than the Sales Tax proceeds levied and collected for the benefit of the Issuer by the City pursuant to Section 4A of the Act, or from any other source. THE ISSUER has reserved the right, subjec~ to restrictions stated and adopted by reference in the Resolution authorizing this Series of Bonds, to issue additional parity revenue bonds which also may be made payable from and secured by a lien on and pledge of the aforesaid Pledged Revenues. IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the Chairperson of the Board of Directors of the Issuer and countersigned with the manual or facsimal% signature of the Secretary of the Board of Directors of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or plaid in Pacsimile, on this Bond. Board of Di~'tors Chahvmon, Bomrd of Direetor~ (SEAL) FORM OF REGISTRATION CERTIFICATE OF THE COMPTROLLER OF PUBLIC ACCOUNTS*: COM[rrROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. 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 that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas. Wimess my signature and seal this (COMPTROLLER'S SEAL) Comptroll~: of Public Accounts of the State of Texas * To be printed only on the Bonds submilled to the Office of the Attorney General for approval, FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE,: PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE (To be executed if this Bond is not accompanied by an executed Registration Certificate of the Comptroller of Public Accounts of the State of Texas) It is hereby certified that this Bond has been issued under the provisions of the Resolution de~cnbed on the face of this Bond; and that this Bond has been issued in exchange for or replacement of a bond, bonds, or a portion of a bond or bonds of an issue which originany was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. JPMorgan Chase Bank, By. Authorized Rept~/~u~talive FORM OF ASSIGNMENT: ASSIGNMENT FOR VALUE RECEIVED, the undersigned registered owner of this Bond, or duly authorized representative or attorney thereof, hereby assigns this Bond to / / (Assignee's Social Security (print or type Assignee's name or Taxpayer Identification Number) and address, including zip code) and hereby irrevocably constitutes and appoints attorney to transfer the registration of this Bond on the Paying Agent/Registrars Registration Books with full power of substitution in the p~alses. Dated Signature Guaranteed: NOTICE: This signature must be guaranteed by a member of the New York Stock Exchange or a commercial bank or trust company. NOTICE: This signature must correspond with the name of the Registered Owner appearing on the face of this Bond in every particular without alteration or enlargement or any change ~. A statement of insurance furnished by the Insurer (as defined in Section 30(d) hereof) with respect to the municipal bond insm'aacg policy issued for the Bonds may be printed on or affixed to the Bonds. Exhibit B to Resolution DESCRIPTION OF ANNUAL FINANCIAL INFORMATION The following information is referred to in Section 19 of ~ Resolution. Annual Financial Statements and Operating Data The finaacial information and operating data with respect to the City to be provided annually in accordance with such Section are as specified (and included in the Appendix or under the headings of the Official Stateraont referred to) below: 1. The information of the general type included in tables 1 through 4, inclusive. 2. Appendix D to the Official Statemcm,"Financial Statements of the Corpus Christi Business and Job Development Corporation". Accounting Principles The accounting prh~ciples referred to in such Section are the accounting principles described in the notes to the financial statements refelxed to in paragraph 2 above. PROJECT AGREEMENT THIS PROJECT AGREEMENT (this "Contract") executed by and between the City of Corpus Christi, Texas (the "City") and the Corpus Christi Business and Job Development Corporation (the "Corporation") WITNESSETH: WHEREAS, the Corporation was created by the City pursuant to authority granted by Article 5190.6, Texas Revised Civil Statutes, as amended (the "Act"), specifically with the Corporation to possess the powers granted by Section 4A of the Act; and WHEREAS, on November 7, 2000, the citizens of the City voting at an election on said date approved the levy of a one-eighth of one percent sales and use tax upon the receipts at retail of taxable items, pursuant to Section 4A of the Act, for the "Arena Project", as described in the proposition approved by the citizens voting at said election (the ''Arena Project Sales Tax"); and WHEREAS, under authority of the Act, it is the intent of the Corporation to issue bonds, notes or other obligations permitted by law (collectively referred to herein as the "Bonds") for the purpose of financing eligible projects under the Act, particularly Section 4A thereof, and to secure said bonds with the Arena Project Sales Tax collected by the City under authority of Section 4A of the Act; and WHEREAS, on the date of the execution of this Contract, the Corporation has adopted a bond resolution (the "Resolution") and the City has approved the adoption of the Resolution by the Corporation, which Resolution has authorized the issuance of the Bonds for the purpose of financing Costs related to the construction, equipping, operation and maintenance of the "Arena Project" (as so defined in the Resolution, the "Project"); and WHEREAS, the Corporation and the City heretofore have entered into a sales tax remittance agreement (the "Sales Tax Remittance Agreement") for the purpose of providing a mechanism for distributing the Arena Project Sales Tax between the Corporation and the City; and WHEREAS, the parties hereto find it necessary and advisable to enter into this Agreement to evidence the duties and responsibilities of the respective parties with respect to the construction and acquisition of the Project. NOW THEREFORE, in consideration of the covenants and agreements herein made, and subject to the conditions herein set forth, the City and the Corporation contract and agree as follows: Section 1. DEFINITIONS AND INCORPORATION OF PREAMBLES. The terms and expressions used in this Contract, unless the context shows clearly otherwise, shall have meanings set forth herein, including terms defined in the Preambles hereto, which preambles are incorporated in and made a part hereof for all purposes, or, if not defined herein, such terms shall have the meanings given in the Resolution. Section 2. OBLIGATION OF CORPORATION TO ACQUIRE. The Corporation agrees to pay, and will pay, all of the actual costs of acquiring and equipping, by purchase and construction, the Project, through the issuance of its Bonds to provide the money for such payment, all in the manner hereinafter described and as provided in the Resolution; and the Corporation, by such payment, will thus acquire, construct and equip the Project for the benefit of the City. Section 3. THE RESOLUTION. The proceeds from the sale of the Bonds will be used for the payment of all of the Corporation's costs and expenses in connection with the Project and the Bonds, including, without limitation, all financing, legal, printing, administrative, and other expenses and costs incurred in issuing its Bonds and acquiring the Project, and to fund a debt service reserve and the other funds required by the Resolution. The Resolution authorizes the issuance of Bonds in the amount not to exceed $50,000,000, to cover the costs and expenses and other amounts required for the initial development of the Project, and to refund the outstanding Series 2001 Notes issued by the Corporation to acquire the site at which the Arena Project is to be constructed and other costs associated with the development of the Arena Project, as specified in the Resolution. However, should the Bond proceeds be insufficient for the payment of all of the Corporation's costs and expenses in connection with the acquisition, construction and equipping of the Project, subject to the limitations contained in the Resolution concerning the use of excess Pledged Revenues, the Corporation may use Arena Project Sales Tax revenues, to the extent they are in excess of amounts needed to pay debt service on the Bonds, and, if so required by the terms of the Resolution, to fund and maintain a reserve fund, to complete the Project in accordance with the terms of the Resolution, and in accordance with Section 4 hereof. Section 4. ACQUISITION CONTRACTS. The City, acting on behalf of and as agent for the Corporation, will enter into such contracts as are necessary to provide for acquiring, by purchase and construction, the entire Project, and said contracts shall be executed as required by the laws applicable to the City. The Corporation shall cause the amounts due under such contracts to be paid from the proceeds from the sale of the Bonds. The Corporation shall deposit the proceeds from the sale of the Bonds into the Construction Fund in accordance with the Resolution. Said Construction Fund shall be used for paying the Corporation's costs and expenses incidental to the Bonds and to pay the costs of acquiring, by purchase and construction, the Project. All contracts and draws on the Construction Fund shall be approved by the Corporation and the City, and any form of written approval signed by the Chairperson of the Board of Directors of the Corporation or by the Director of Financial Services of the City will evidence the approval of the Corporation and the City for the purposes of this Section 4. Draws on the Construction Fund shall be made in accordance with Section 11 of the Resolution. Section 5. OWNERSHIP OF PROJECT. (a) The Corporation will provide, make available, and render, to and for the benefit of the City and its inhabitants, the facilities and services of the Project paid for and acquired by the Corporation pursuant to this Contract. It is agreed that the City always shall have the exclusive use of the Project. In consideration of the Corporation's acquiring, making available, and rendering to and for the benefit of the City and its inhabitants, the facilities and services of the Project, the City makes and agrees to comply with its covenants which are set forth in the Sales Tax Remittance Agreement. As further consideration, it is agreed that the City will have the sole responsibility for operating and maintaining the Project, and that funds for such purpose shall be made available to the City by the Corporation from the Arena Project Sales Tax, consistent with the proposition authorizing the levy and collection of the Arena Project Sales Tax approved by the citizens of the City at the November 7, 2000 election. The City shall not be relieved of its covenants and obligations under the Sales Tax Remittance Agreement, notwithstanding the failure of the Corporation to acquire or construct all or any part of the Project. It is hereby provided that in further consideration of the covenants made by the City under this Section and under the Sales Tax Remittance Agreement, the City shall become the owner of the Project upon completion of the construction of each distinct portion of the Project, as more particularly described in Section 5(b) of this Contract. (b) After completion of the acquisition and construction of each identifiable portion of the Project, and when an identifiable portion of the Project is ready to be placed in service, the City shall inspect the same and if it is found by the City to have been acquired and constructed as required by this Contract, the City, acting by and through the City Manager of the City, shall notify the Corporation in writing that it has accepted the Project. Upon such acceptance, all of the Corporation's right, title, and interest of every nature whatsoever in and to such portion of the Project automatically shall vest irrevocably in the City without the necessity of the execution of any convey- ance by the Corporation, and such transaction shall result in the automatic sale and delivery of such portion of the Project by the Corporation to the City, and the vesting of title to such portion of the Project in the City in consideration for the agreement of the City to perform its obligations required under this Contract. If requested in writing by the City, acting by and through the City Manager of the City, the Corporation will execute and deliver to the City an appropriate instrument acknowledging that such sale, delivery, and vesting of title has occurred, but such instrument shall not be necessary to effect the automatic sale, delivery, and vesting of title, which shall occur as described above. Until the acceptance of a portion of the Project by the City, ail right, title, and interest in and to a portion of the Project shall be in the Corporation. After such acceptance and the resulting sale, delivery, and vesting of title in the City, the Corporation shall have no right, title, or interest in, or responsibility with respect to, a portion of the Project and the Corporation shall have no right to extend, improve or otherwise expend funds in the Construction Fund of the Resolution for such portion of the Project. Section 6. ACQUISITION. The City and the Corporation agree to proceed promptly with the acquisition, by purchase and construction, of the Project. The City and Corporation hereby covenant that they will make a diligent effort to complete such acquisition as soon as practicable. The City and the Corporation do not anticipate any delays in completing the acquisition of the Project, but the City and the Corporation shall not be liable to each other for any damages caused by any delays in completion of the Project. Section 7. USE OF CITY'S PUBLIC PROPERTY. By these presents, the City authorizes use by the Corporation of any and all real property, streets, alleys, public ways and places, and general utility or sewer easements of City for acquisition and construction of the Project. Section 8. FORCE MAJEURE. If, by reason of Force Majeure, either party hereto shall be rendered unable wholly or in part to carry out its obligations under this agreement, then such party shall give notice and full particulars of such Force Majeure in writing to the other party within a reasonable time after occurrence of the event or cause relied upon, and the obligation of the party giving such notice, so far as it is affected by such Force Majeure, shall be suspended during the continuance of the inability then claimed, except as hereinafter provided, but for no longer period, and any such party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term Force Majeure as employed herein, shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of public enemy, orders of any kind of the Government of the United States or the State of Texas or any civil or military authority, insurrections, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipelines, or canals, or other causes not reasonably within the control of the party claiming such inability. It is understood and agreed that the settlement of strikes and lockouts shall be entirely within the discretion of the party having the difficulty, and that the above requirement that any Force Majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes and lockouts by acceding to the demands of the opposing party or parties when such settlement is unfavorable to it in the judgment of the party having the difficulty. It is specifically excepted and provided, however, that in no event shall any Force Majeure relieve the City of its obligation to transfer Arena Project Sales Tax revenues to the Corporation as required under the Sales Tax Remittance Agreement, and for the Corporation to apply, account for, and transfer the Pledged Revenues as provided in the Resolution. Section 9. REGULATORY BODIES. This Contract and the Project shall be subject to all valid rules, regulations, and laws applicable thereto passed or promulgated by the United States of America, the State of Texas, or any governmental body or 4 agency having lawful jurisdiction or any authorized representative or agency of any of them. Section 10. TERM OF CONTRACT. That the term of this Contract shall be for the period during which the Bonds or any interest thereon are outstanding and unpaid. [Execution Page Follows] IN WITNESS WHEREOF, the Corporation and the City, acting under authority of their respective governing bodies have caused this Contract to be duly executed in several counterparts, each of which shall constitute an original, all as of the 21st day of August, 2001, which is the date of this Contract. CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION ATTEST: By Chairperson, Board of Directors Secretary, Board of Directors (CORPORATION SEAL) CITY OF CORPUS CHRISTI, TEXAS ATTEST: By. City Manager City Secretary (CITY SEAL) $47,540,000' CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING AND IMPROVEMENT BONDS, SERIES 2002 (ARENA PROJECT) PURCHASE CONTRACT October ,2002 Chairperson and Board of Directors Corpus Christi Business and Job Development Corporation 1201 Leopard Corpus Christi, Texas 78401 Ladies and Gentlemen: The undersigned (the "Underwriters"), acting through the Authorized Representative designated in Section I hereof (the "Authorized Representative"), offer to enter into the following agreement (this "Purchase Contract") with the CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION (the "Corporation") which, upon your acceptance of this offer, will be binding upon you and upon the Underwriters. The offer contained herein is made subject to your acceptance of this Purchase Contract on or before 10:00 p.m., Corpus Christi, Texas time, on the date hereof and, if not so accepted, will be subject to withdrawal by the Underwriters upon notice delivered to the Corporation by the Underwriters at any time prior to the acceptance hereof by the Corporation. 1. Purchase and Sale of the Bonds. Upon the terms and conditions and upon the basis of the respective representations, warranties, and covenants set forth herein, the Underwriters hereby agree to purchase from the Corporation, and the Corporation hereby agrees to sell and deliver to the Underwriters, all (but not less than all) of an aggregate of $47,540,000 original principal amount of CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING AND iMPROVEMENT BONDS, SERiES 2002 (ARENA PROJECT) (the "Bond¥"). The Bonds shall be dated October 15. 2002 and shall have the stated maturities, be offered at the prices, and bear interest at the rates pcr annum all as set forth in the Official Statement (hereinafter defined). Interest on the Bonds will be payable initially on March 1,2003 and on each September 1 and March I thereafter. In addition, the authorization for the City Manager to obtain a municipal bond insurance policy for the Bonds and a surety bond policy for the Reserve Fund for *Preliminary, subject to change #45232900vl thc Bonds is further described in Schedule i attached hereto. As provided in the Bond Resolution (hereafter defined), the City Manager has been authorized by the Board of Directors of the Corporation to execute this Purchase Contract based upon the information contained in Schedule I hereto. The purchase price for the Bonds is $ (representing an aggregate principal amount of $ of Bonds, plus a net original issue premium of $ , less the Underwriters' discount of $ ), and no accrued interest. On behalf of the Corporation, the Underwriters shall also transfer, via federal funds wire, on the date of the Closing the amount of $ to the Insurer (hereinafter defined) as the insurance premiums for the bond insurance policy and the surety bond policy, if any. This amount shall reduce the purchase price for the Bonds and is being transferred to the lnsurer by the Authorized Representative on the date of the Closing (hereafter defined) as an accommodation to the Corporation. The Bonds are to be issued pursuant to the provisions of Texas Revised Civil Statutes Annotated Article 5190.6, as amended (the "Act"), specifically Section 4A of the Act, and are secured under the provisions of a resolution dated October 7, 2002 authorizing their issuance and sale (the "BondResolution") adopted by the Board of Directors of the Corporation (the "Board") on the date hereof. The Bonds are to bear interest, be subject to redemption, and be payable as provided in the Bond Resolution, all as described in the Official Statement referred to below. Capitalized terms not defined herein shall have the meanings assigned in the Bond Resolution. A portion of the proceeds received by the Corporation from the sale of the Bonds pursuant hereto and certain other funds of the Corporation, if any, shall be utilized to redeem the Refunded Notes (as defined in the Official Statement). The Corporation and the City Council of the City of Corpus Christi, Texas (the "City") have entered into a Sales Tax Remittance Agreement (the "Financing Agreement") relating to the transfer of the Sales Tax from the City to the Corporation and a Project Agreement (the "Project Agreement ") relating to the construction and transfer of the Project frmn the Corporation to the City. RBC Dain Rauscher Inc. represents that it has been duly authorized to execute this Purchase Contract and has been duly authorized to act hereunder as the Authorized Representative. All actions which may be taken hereunder by the Underwriters may be taken by the Authorized Representative alone. In as much as this purchase and sale represents a negotiated transaction, the Corporation understands, and hereby confirms, that the Underwriters are not acting as a fiduciary of the Corporation, but rather are acting solely in their individual capacities as an underwriter for their own accounts. 2. Public Offering. The Underwriters agree to make a bona fide public offering of all of the Bonds at a price not to exceed the public offering price set forth on the cover of the Official Statement and may subsequently change such offering price without any requirement of prior notice. The Underwriters agree, for the purpose of enabling the Corporation to comply with its obligations set forth in Section 5(1) of this Purchase Contract, to inform the Corporation of the date of expiration of the initial offering period for the Bonds. The Underwriters may offer and sell Bonds to certain #45212900vl -2- dealers (including dealers depositing Bonds into investment trusts) and others at prices lower than the public offering price (or yields higher than the public offering yields) stated on the cover of the Official Statement. On or before Closing, the Authorized Representative shall execute the Issue Price Certificate attached hereto as Exhibit A verifying the initial offering prices to the public at which a substantial amount of each stated maturity of the Bonds was sold to the public. 3. Official Statement. The Bonds are described in the final Official Statement dated the date hereof, a substantially final version of which is attached hereto as Exhibit B. Such final Official Statement, together ~vith the Appendices thereto, as further amended or supplemented only in the manner hereinafter provided, is herein referred to as the "Official Statement". The Corporation hereby authorizes and approves the distribution and use by the Underwriters of the Official Statement in connection with the offering and sale of the Bonds. In addition, the Corporation hereby ratifies and approves the distribution of the Preliminary Official Statement dated October 17~ 2002 relating to the Bonds (the "Preliminary Official Statement") and its use by the Underwriters prior to the date hereof in connection with the offering and sale of the Bonds. The Corporation shall within seven days of the date hereof(exclusive of Saturdays, Sundays, and legal holidays) provide additional printed copies of the Official Statement in such form and number as the Underwriters may request in order to enable the Underwriters to comply with their obligations set forth in 17 C.F.R. Section 240.15c2-12 ("Rule 15c2-12"). In the event that the number of additional copies of the Official Statement supplied to the Underwriters pursuant to the immediately preceding sentence shall prove to be insufficient to enable the Underwriters to comply with their obligations under paragraph (b) of Rule 15c2-12, the Corporation agrees to make available from time to time such additional printed or photostatic copies of the Official Statement as may be required to enable the Underwriters to comply with their obligations under Rule 15c2-12, but at the expense of the Underwriters. Lastly, the Board hereby ratifies and approves the execution by the Chairperson of the Board of a Rule 15c2-12 Certificate pertaining to the distribution of the Preliminary Official Statement. 4. Securi~ Deposit. Delivered to the Corporation herewith is a corporate check of the Authorized Representative payable to the order of the Corporation in the amount of $475,000. The Corporation agrees to hold such check uncashed until the Closing to ensure the perforn~ance by the Underwriters of their obligations to purchase, accept delivery of, and pay for the Bonds at the Closing. Concurrently with the payment by the Underwriters of the purchase price of the Bonds at the Closing, the Corporation shall return such check to the Authorized Representative. Should the Corporation fail to deliver the Bonds at the Closing, or should the Corporation be unable to satisfy the conditions of the obligations of the Underwriters to purchase, accept delivery of, and pay for the Bonds, as set forth in this Purchase Contract (unless waived by the Authorized Representative), or should such obligations of the Underwriters be terminated for any reason permitted by this Purchase Contract, such check shall immediately be returned to the Authorized Representative. In the event the Unde~vriters fail (other than for a reason permitted hereunder) to purchase, accept delivery of, and pay for the Bonds at the Closing as herein provided, such check shall be retained by the Corporation as and for full liquidated damages for such failure of the Underwriters and for any defaults hereunder on the part of the Underwriters. Acceptance of such check by the Corporation #45232900vl -3- shall constitute a full release and discharge of ali claims and damages for such failure and for any and all such defaults, and neither the Corporation nor any other person shall have any further action for damages, specific performance, or any other legal or equitable relief against the Underwriters. The Underwriters and the Corporation understand that in such event the Corporation's actual damages may be greater or may be less than such amount. Accordingly, the Underwriters hereby waive any right to claim that the Corporation's actual damages are less than such amount, and the Corporation's acceptance of this offer shall constitute a waiver of any right the Corporation may have to additional damages from the Underwriters. The Authorized Representative hereby agrees not to stop or cause payment on said check to be stopped unless the Corporation has breached any of the terms of this Purchase Contract. 5. Representations and Warranties. The Corporation hereby represents and warrants to the Underwriters as follows: (a) The Corporation is a nonprofit industrial development corporation of the State of Texas created by the City of Corpus Christi, Texas pursuant to Section 4A of the Act, and is duly created, organized and existing in good standing under the laws of the State of Texas and the Act. (b) The Corporation has the power and is authorized under the laws of the State of Texas, including particularly the Act, to (i) issue the Bonds for the purpose for which they are to be issued, and (ii) enter into and perform this Purchase Contract, the Project Agreement, and the Financing Agreement. (c) The Corporation has the requisite right, power, and authority (i) to adopt the Bond Resolution authorizing the issuance of the Bonds and the execution and delivery of this Purchase Contract, the Project Agreement, and the Financing Agreement, (ii) to execute, deliver, and perform its obligations under this Pumhase Contract, the Project Agreement, and the Financing Agreement, and (iii) to consurmnate the transactions described in such instruments and in the Official Statement, and the Corporation has complied with all provisions of applicable law in all matters relating to such transactions. (d) The information contained in the Preliminary Official Statement is as of the date hereof, and the information contained in the Official Statement as of the date of Closing, will be correct in all material respects, and such information does not contain and will not contain any untrue statement ora material fact and does not omit and will not onfit to state a material fact required to be stated therein or necessary to make the statements in the Preliminary Official Statement, as of the date hereof, or in the Official Statement, as of the date of Closing, in light of the circumstances under which they were made, not misleading. (e) The Corporation has duly authorized all necessary action to be taken by it for (i) the issuance and sale of the Bonds upon the terms set forth herein and in the Official ~45232900vt -4- Statement; (ii) the approval of the Official Statement and the signing of the Official Statement by a duly authorized officer(s); and (iii) the execution, delivery, and receipt of this Purchase Contract, the Bonds, the Project Agreement, the Financing Agreement, and any and all such other agreements and documents as may be required to be executed, delivered, and received by the Corporation in order to carry out, give effect to, and consummate the transactions described herein and in the Bonds, the Official Statement, the Project Agree~nent, and the Financing Agreement. (f) The Bond Resolution is and, on the date of the Closing, will be in full force and, on the date of Closing, the Financing Agreement and the Project Agreement will have been duly executed and delivered by the Corporation. The Bond Resolution is and, on the date of the Closing, will be the legal and valid act of the Corporation, and, assuming the due authorization, execution, and delivery of such instruments by the other parties thereto and their authority to perform such instm~nents, this Purchase Contract, the Project Agreement, and the Financing Agreement are, and, on the date of the Closing will be, the legal, valid, and binding agreements on behalfo fthe parties thereto, enforceable (assuming the due authorization and execution by the other parties to such documents) in accordance with their respective terms (except to the extent that such enforceability may be limited by bankruptcy, insolvency, reorganization, and similar laws affecting creditors' rights generally and general principles of equity). (g) The Bonds, when issued, delivered, and paid for as herein provided, will have been duly authorized, executed, and issued and will constitute legal, valid, and binding obligations of the Corporation entitled to the benefits of the Bond Resolution. (h) Except as otherwise disclosed in the Official Statement, there is no action, suit, proceeding, inquiry, or investigation at law or in equity or before or by any commission, public board, or body pending against the Corporation or, to the knowledge of the Corporation, threatened against or affecting the Corporation (or, to the knowledge of the Corporation, any basis therefor) contesting the due organization and valid corporate existence of the Corporation or wherein an unfavorable decision, ruling, or finding would adversely affect (i) the transactions described herein or in the Official Statement relating to the issuance of the Bonds by the Corporation, (ii) the validity or due adoption of the Bond Resolution, or the validity, due authorization, and execution of the Bonds, this Purchase Contract, the Project Agreement, the Financing Agreement, or any agreement or instrument to which the Corporation is a party and which is to be used in the consummation of the transactions described herein or in the Official Statement, (iii) the collection or application of the Sales Tax pledged to pay the principal of and interest on the Bonds, or (iv) the federal tax-exempt status of the interest on the Bonds. Except as described in the Official Statement, the Corporation is not a party to any litigation or other proceeding pending or, to its knowledge, threatened, in any commission, agency, or other administrative body (either state or federal) which, if decided adversely to the Corporation, would have a materially adverse effect on the financial condition of the Corporation. #4s232900vl -5- (i) The authorization, execution, and delivery by the Corporation of the Official Statement, this Purchase Contract, the Bonds, the Project Agreement, the Financing Agreement, and the other documents described herein and in the Official Statement, the adoption of the Bond Resolution by the Corporation, the consummation of the transactions described herein and therein, and compliance by the Corporation with the provisions of such instruments, do not and will not conflict with or constitute on the part of the Corporation a breach of or a default under any provision of the Constitution of the State of Texas or the Act or any other existing law, commission or administrative decision, regulation, decree, or order or any agreement, indenture, mortgage, lease, or other instrument by which the Corporation or its properties are or, on the date of Closing, will be bound or affected. (j) Other than the opinion of the Attorney General of the State of Texas approving the Bonds as required by law and the registration of the Bonds by the Comptroller of Public Accounts of the State of Texas (which approvals and registration shall have been duly obtained or effected on or before the date of the Closing), and other than such perufits, consents, licenses, notices, and filings, if any, as may be required under the securities or blue sky laws of any jurisdiction as requested by the Underwriters (all of which, subject to Section 11 (c) hereof, shall have been duly made or obtained on or before the date of the Closing), no permit, consent, license, notice, or filing with governmental authorities is necessary or required (i) to permit the Corporation to execute and deliver this Purchase Contract, the Financing Agreement, or the other instruments and documents described herein or therein, to perform its obligations hereunder and thereunder, or to consummate the transactions described herein or therein, or (ii) to issue and deliver the Bonds as described herein and in the Official Statement, or to perform in accordance with thc terms hereof and thereof, or (iii) to adopt and enact the Bond Resolution, or to perform in accordance with the terms thereof, or to issue and sell the Bonds as therein and in the Official Statement provided. (k) The financial statements of the Corporation included in Appendix C to the Official Statement present fairly the financial position and the results of operations of the Corporation at the respective dates and for the respective periods indicated therein, in confbrmity with generally accepted account principles applied on a consistent basis throughout the periods presented. (I) If, after the date of this Purchase Contract to and including the date the Underwriters are no longer required to provide an Official Statement to potential customers who request the same pursuant to the Rule 15c2-12 (the earlier of (i) 90 days from the end of the underwriting period (as defined in Rule 15c2-12) and (ii) the time when the Official Statement is available to any person from a nationally recognized municipal securities repository, but in no case less than 25 days after the end of the underwriting period for the Bonds), the Corporation becomes aware of any fact or event which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement ora material fact or to omit to state a material fact required to be stated therein or necessary #4>232900v1 -6- to make the statements therein, not misleading, or if it is necessary to amend or supplement the Official Statement to comply with law, the Corporation will notify the Authorized Representative (and for the purposes of this clause provide the Authorized Representative with such information as it may from time to time request), and if, in the reasonable opinion of the Authorized Representative, such fact or event requires preparation and publication of a supplement or amendment to the Official Statement, the Corporation will forthwith prepare and furnish, at the Corporation's own expense (in a form and manner approved by the Authorized Representative), a reasonable number of copies of either amendments or supplements to the Official Statement so that the statements in the Official Statement as so amended and supplemented will not, contain any untrue statement ora material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading or so that the Official Statement will comply with law. If such notification shall be subsequent to the Closing, the Corporation shall furnish such legal opinions, certificates, instruments and other documents as the Authorized Representative may deem necessary to evidence the troth and accuracy of such supplement or amendment to the Official Statement. (m) Between the date of this Purchase Contract and the date of the Closing the Corporation shall disclose to, discuss with, and provide any information reasonably requested by the Underwriters in connection with any breach, default, or failure to comply, of whatever nature and of which the Corporation has knowledge, regarding any law, loan agreement, indenture, or other agreement to which the Corporation is a party or to which the Corporation or any of the property or assets of the Corporation is other,vise subject. (n) The Corporation has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that the Corporation is a bond issuer whose arbitrage certificates may not be relied upon. (o) To the best of the knowledge and belief of the Corporation, the Preliminary Official Statement contains information, including financial information on operating data, concerning every entity, enterprise, fund, account, or person that is material to an evaluation of the offering of the Bonds; and the Corporation has entered into previous continuing disclosure undertakings (the '~Undertaking") in a written contract or agreement specified in Rule 15c2-12 (b)(5)(i) and has not failed to comply with any such Undertaking in any material respect. (p) The Bonds conform to the descriptions thereof contained in the Official Statement under the caption "THE BONDS"; the Bond Resolution conforms to the description thereof contained in the Official Statement under the caption "THE BONDS"; the proceeds of the sale of the Bonds will be applied generally as described in the Official Statement under the caption "SOURCES AND USES OF FUNDS" and the Undertaking conferees to the description thereof contained in the Official Statement under the caption "CONTINUING DISCLOSURE OF INFORMATION." #45232900v1 -7- (q) Between the date of this Purchase Contract and the Closing, the Corporation will not, without the prior written consent of the Underwriters, issue any additional bonds, notes or other obligations for borrowed money payable in whole or in part from the revenues of the Corporation's Sales Tax levied by the City and transferred to the Corporation pursuant to the Act, nor will there be any adverse change of a material nature in the financial position of the Corporation. (r) The Corporation will apply, or cause to be applied, the proceeds from the sale of the Bonds as provided in and subject to all of the terms and provisions of the Bond Resolution and not to take or omit to take any action which action or omission will adversely affect the exclusion from gross income for federal income tax purposes of the interest on the Bonds. (s) Any certificate, signed by any official of the Corporation authorized to do so in connection with the transactions contemplated by this Purchase Contract, shall be deemed a representation and warranty by the Corporation to the Underwriters as to the statements made therein. (t) Between the date of this Purchase Contract and the date of the Closing the Corporation shall disclose to, discuss with, and provide any information reasonably requested by the Underwriters in connection with any breach, default, or failure to comply, of whatever nature and of which the Corporation has knowledge, regarding any law, loan agreement, indenture, or other agreement to which the Corporation is a party or to which the Corporation or any of the property or assets of the Corporation is otherwise subject. 6. Representations and Covenants. The Authorized Representative hereby agrees to file the Official Statement with a nationally recognized municipal securities information repository. Unless otherwise notified in writing by the Authorized Representative, the Corporation can assume that the end of the underwriting period for purposes of the Rule 15c2-12 is the date of the Closing. 7. Delivery of, and Payment for, the Bonds. The consummation of the sale of the Bonds to the Underwriters (the "Closing") shall be held at such location or locations as may be mutually agreed upon by the Corporation and the Underwriters. The Closing shall be held at the offices of McCall, Parkhurst & Horton L.L.P., 717 North Harwood, Suite 900, Dallas, Texas 75201 at 9:00 a.m., Dallas, Texas time, on November 21, 2002, or at such other time or date as shall be mutually agreed upon by the Corporation and the Authorized Representative. Subject to the conditions stated herein, at the Closing, the Corporation will deliver, or cause to be delivered, to the Underwriters the Bonds (being one initial Bond per maturity) in temporary form, duly executed and registered as hereinafter provided, together with the other documents hereinafter mentioned, and the Underwriters will accept such delivery and pay the purchase price of the Bonds as set forth in Section 1 hereof in immediately available funds by check or wire transfer to or for the account of the Corporation. [t is anticipated that the definitive Bonds shall be issued in the form of one typewritten or printed bond for each maturity, registered in the name of #45232900v I -8- Cede & Co., as the registered owner and nominee for The Depository Trust Company, New York, New York ("D T£7') in the same aggregate principal amount of the Bonds. Delivery of the Definitive Bonds as aforesaid shall be made at the place in New York, New York, designated by DTC. The Corporation will have the opinion of Bond Counsel attached to or printed on the Bonds. The definitive Bonds shall be in fully registered fom~, bear proper CUSIP numbers, and be in authorized denominations and registered in such names and in such amounts as the Underwriters may request. The definitive Bonds shall be made available to the Underwriters for checking and packaging not less than two full business days prior to the Closing. In lieu of the foregoing, such Bonds shall be held in safe custody by the paying agent/registrar or any authorized agent for the paying agent/registrar. The paying agent/registrar shall release or authorize the release of such Bonds at the Closing from safe custody to the Underwriters upon receipt by the Corporation of payment for the Bonds as provided herein. In addition, the Corporation and the Underwriters agree that there shall be a preliminary Closing held at such place as the Corporation and the Authorized Representative shall mutually agree, commencing at least 24 hours prior to the Closing; provided, however, in lieu of this preliminary closing Bond Counsel may provide the counsel to the Underwriters with a complete Transcript of Proceedings on the business day preceding the Closing. Drafts of all documents to be delivered at the Closing shall be prepared and distributed to the parties and their counsel for review at least three business days prior to the Closing. 8. Certain Conditions to Underwriters' Obligations. The obligations of the Underwriters hereunder are subject to the satisfaction on or before the date of the Closing of each of the following conditions (unless waived by the Under~vriters in writing): (a) The representations and warranties of the Corporation contained herein or on any certificate or other document delivered pursuant to the provisions hereof shall be true on and as of the date of the Closing as though such representations and warranties were made on and as of the date of the Closing. (b) The Corporation shall have perfbrmed and complied with all agreements and conditions required by this Purchase Contract to be performed or complied with by it prior to or on the date of the Closing. (c) At the time of the Closing, the Bond Resolution shall be in full force and effect, and the Bond Resolution shall not have been amended, modified, or supplemented, and the Official Statement shall not have been amended, modified, or supplelnented, except as may have been agreed to in writing by the Underwriters. (d) At the time of the Closing, all official action of the Corporation related to the Bond Resolution shall be in full force and effect and shall not have been amended, modified, or supplemented. #45232900vl -9- (e) The Corporation shall not have failed to pay principal or interest when due on any of its ontstanding obligations for borrowed money. (f} Except as described in the Official Statement, no suit, action, investigation, or legal or administrative proceeding shall be threatened or pending before any commission or governmental agency which is likely to result in the restraint, prohibition, or the obtaining of damages or other relief in connection with the issuance of the Bonds or the consummation of the transactions described herein, or which, in the opinion of the Underwriters, would have a materially adverse effect on the transactions described herein. (g) All steps to be taken and all instruments and other documents to be executed, and all other legal matters in connection with the transactions described in this Purchase Contract shall be reasonably satisfactory in legal form and effect to counsel for the Unde~vriters. (h) At or prior to the Closing, the Underwriters shall have received two (2) executed copies of each of the following documents: (1) the opinion, dated the date of the Closing, of McCall, Parkhurst & Horton L. L. P., Dallas, Texas as bond counsel ("Bond Counsel"), in substantially the form attached in the Official Statement as Appendix D relating to the Bonds; (2) the supplemental opinion of Bond Counsel in substantially the form attached hereto as Exhibit C; (3) an opinion, dated the date of the Closing, of Fulbright & Jaworski L.L.P., San Antonio, Texas, counsel for the Underwriters, in substantially the form of Exhibit D hereto; (4) an opinion, dated the date of the Closing, of the City Attorney in the substantially form attached hereto as Exhibit E hereto; (5) an opinion, dated the date of the Closing, dated the date of Closing, of the general counsel to (the "Insurer") addressed to the Underwriters, Bond Counsel, counsel to the Underwriters, the financial advisors to the Corporation, and the Corporation in a form satist:actory to Bond Counsel and counsel to the Underwriters; (6) a certificate of the Corporation, dated the date of the Closing and signed on its behalf by the Chairperson of the Board, acting solely in his official capacity, in form satisfactory to Bond Counsel and counsel to the Underwriters, to the effect that (a) the representations and warranties of the Corporation herein, or in any certificate or document delivered by the Corporation pursuant to the provisions hereof; are true and correct in all material respects on and as of the date of the Closing as though such representations and warranties were made on and as of thc date of the Closing, (b) all agreements or conditions to be performed or complied with by the Corporation hereunder to effect the delivery of the Bonds on or prior to the date of the Closing have been performed or complied with, and (c) there has not been any materially adverse change in the financial condition of the Corporation since July 31, 2001; (7) the Official Statement executed on behalf of the Corporation by the Chairperson and the Secretary by manual or facsimile signatures; (8) a copy of the Bond Resolution and all other orders, ordinances, or resolutions or other proceedings of the Corporation authorizing the issuance and sale of the Bonds and the execution and delivery of this Purchase Contract, the Official Statement, the Project Agreement, and the Financing Agreement in each case certified by the Secretary of the Board, as having been duly adopted and being in full force and effect and as being true. accurate, and complete copies thereof; (9) the unqualified opinion, dated on or prior to the date of the Closing, of the Attorney General of the State of Texas (the "Attorney General"), relating to the legality and validity of the Bonds, the defeasance of the Refunded Notes, and approving the Bonds as required by law; (10) evidence satisfactory to the Underwriters that the Bonds have been registered by the Comptroller of Public Accounts of the State of Texas as required by law; (11) a letter from Moody's Investors Service, Inc., Standard & Poor's Ratings Group, and Fitch Ratings indicating a rating for the Bonds which is not lower than "Aaa", "AAA" or "AAA", respectively, based upon the issuance of the bond insurance policy by the Insurer; (12) a certificate, dated the date of the Closing, executed by the Chai~T~erson of the Board, acting solely in his official capacity, to the effect that (i) except to the extent disclosed in the Official Statement, no litigation to which the Corporation is a party is now pending before any federal or state court, or administrative body, or to his knowledge threatened, that seeks to restrain or enjoin the issuance or delivery of the Bonds or questioning the issuance or sale of the Bonds, or the authority or action of the governing body of the Corporation relating to the issuance or sale of the Bonds, or the levy, collection, or application of the Sales 'Pax pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or that would otherwise adversely affect in a material manner the financial #43232900vt -1 1- condition of the Corporation to pay the principal of and interest on the Bonds; and neither the corporate existence or boundaries of the Corporation nor the right to hold office of any me~nber of the governing body of the Corporation or any other elected or appointed official of the Corporation is being contested or otherwise questioned, or in any way contesting or affecting the validity of the Bonds, the Bond Resolution, the Financing Agreement, the Project Agreement, or this Purchase Contract, or contesting the powers of the Corporation to issue the Bonds, or contesting authorization of the Bonds, or the Bond Resolution, or contesting in any way the accuracy, completeness, or fairness of the Preliminary Official Statement (to the extent not modified by the Official State~nent) or the Official Statetnent; and (ii) to the best of such person's knowledge, no event affecting the Corporation has occurred since the date of the Official Statement which should be disclosed therein for the purpose for which it is to be used or which it is necessary to be disclosed therein in order to make the statements and information therein not misleading in any respect; (13) a certificate of the Corporation, dated the date of the Closing, and signed by an authorized representative of the Corporation in the form approved by Bond Counsel and satisfactory to the Authorized Representative and Underwriters' counsel, with respect to arbitrage matters relating to the Bonds; (14) a policy of bond insurance from the Insurer, which unconditionally and irrevocably guarantees the full, complete, and timely payment of an amount equal to the principal of and interest on the Bonds and a surety bond policy relating to the Reserve Fund, along with the customary closing certificates executed by the Insurer; (15) copies of the election proceedings from the November 7, 2000 election authorizing the imposition of the Sales Tax and evidence of preclearance of this election by the United States Department of Justice; (16) a certificate from the authorized representative of the City relating to certain matters with respect to the City, the Sales Tax, the Financing Agreement, the Project Agreement, the City's Resolution (hereinafter defined) and the issuance of the Bonds; (17) the certificate of existence and a good standing certificate dated within thirty days of the closing relating to the Corporation; (18) the resolution adopted by the City Council of the City on October , 2002 (the "City's Resolution") approving the Financing Agreement, the Project Agreement, and the issuance of the Bonds; and #4q232900v I - 12- (19) Evidence satisfactory to the Authorized Representative that the Refunded Notes are no longer outstanding and had been paid in full. (i) The Underwriters shall receive such additional legal opinions, certificates, proceedings, instruments, and other documents as counsel to the Underwriters or Bond Counsel may reasonably request to evidence compliance by the Corporation with legal requirements, the troth and accuracy, as of the time of Closing, of the representations and warranties of the Corporation contained herein, and the due performance or satisfaction by the Corporation at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by the Corporation. (j) The Corporation shall have returned the corporate check of the Authorized Representative delivered to the Corporation pursuant to Section 4 hereof. (k) The Underwriters shall receive such additional legal opinions, certificates, proceedings, instruments, and other documents as counsel to the Underwriters or Bond Counsel may reasonably request to evidence compliance by the Corporation with legal requirements, the truth and accuracy, as of the time of Closing, of the representations and warranties of the Corporation contained herein. All such opinions, certificates, letters, agreements, and documents will be in compliance with the provisions hereof only if they are satisfactory in form and substance to the Underwriters and their counsel and to Bond Counsel. The Unde~vriters shall be entitled to receive such conformed copies or photocopies of such opinions, certificates, letters, agreements, and documents as the Underwriters may reasonably request. 9. Conditions to Obligations of the Corporation. The obligations of the Corporation hereunder to deliver the Bonds shall be subject to receipt on or belbre the date of the Closing of the purchase price set forth in Section 1 hereof, the opinion of Bond Counsel described in Section 8(h)( I ) hereof, and the opinion of the Attorney General o fTexas described in Section 8(h)(9) hereof. 10. Termination. The Underwriters shall have the right to cancel their obligation to purchase the Bonds if, between the date hereof and the Closing, (i) legislation shall be enacted or recommended to the Congress for passage by the President of the United States, or favorably reported for passage to either House of the Congress by any comlnittee of such House to which such legislation has been referred for consideration, a decision by a Commission of the United States or the United States Tax Commission shall be rendered, or a ruling, regulation, or statement by or on behalf of the Treasury Department of the United States, the Internal Revenue Service, or other governmental agency shall be made or proposed, the effect of any or all of which would be to impose directly or indirectly federal income taxation upon interest received on obligations of the general character of the Bonds or upon income of the general character to be derived by the Corporation in such a manner as, in the reasonable opinion of the Underwriters, would materially adversely affect the market price of the Bonds, or the market price generally of obligations of the general character of the Bonds, or (ii) there shall exist any event which, in the reasonable judgment of the #45232t~00v I - 13- Underwriters, either (a) makes untrue or incorrect in any material and adverse respect any statement or information contained in the Official Statement or (b) is not reflected in the Official Statement but should be reflected therein in order to make the statements and information contained therein not misleading in any material respect, or (iii) there shall have occurred any national or international calamity or crisis, including, without limitation, financial crisis, or a financial crisis or a default with respect to the debt obligations of, or the institution of proceedings under the federal or the state bankmptcy laws by or against the State of Texas or any political subdivision, agency, or instrumentality of the State of Texas, the eff'ect of which on the financial markets of the United States being such as, in the reasonable judgment of the Underwriters, would make it impracticable tbr the Unde~wvriters to market the Bonds or to enforce contracts for the sale of the Bonds, or (iv) there shall have occurred any (a) new material outbreak of hostilities (including, without limitation, an act of terrorism) or (b) new material other national or international calamity or crisis, or any material adverse change in the financial, political or economic conditions affecting the United States, including, but not limited to, an escalation of hostilities that existed prior to the date hereof and the effect of any such event on the financial markets of the United States, shall be such as would make it impracticable, in the reasonable judgment of the Underwriters, for the Underwriters to sell the Bonds on the terms and in the manner contemplated by the Official Statement; or (v) there shall be in force a general suspension of trading on the New York Stock Exchange, or (vi) a general banking moratorium shall have been declared by either federal, Texas, or New York authorities, or (vii) there shall have occurred any materially adverse change in the affairs or financial condition of the Corporation, except for changes which the Official Statement discloses have occurred or may occur, or (viii) legislation shall be enacted or any action shall be taken by the Securities and Exchange Commission which, in the written opinion of counsel for the Underwriters delivered to the Underwriters and the Corporation, has the effect of requiring the contemplated distribution of the Bonds to be registered under the Securities Act of 1933, as amended, or requiring the Bonds or the Bond Resolution or any other document relating to the Bonds or transactions described herein to be qualified under the Trust Indenture Act of 1939, as amended, or (ix) a stop order, ruling, regulation, or official statement by or on behalf of the Securities and Exchange Commission shall be issued or made to the effect that the issuance, offering, or sale of the Bonds, or of obligations of the general character of the Bonds, is in violation of any provision of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, or the Trust Indenture Act of 1939, as amended, or (x) any state blue sky or securities commission or other governmental agency or body in a state in which Bonds shall have been sold shall have withheld registration, exemption, or clearance of the offering of the Bonds as described herein, or issued a stop order or similar ruling relating thereto, and in the reasonable judgment of the Underwriters, the market tYr the Bonds would be materially affected thereby, or (xi) the Constitution of the State of Texas shall be amended, or an amendment shall be proposed, or legislation shall be enacted, or a decision shall have been rendered as to matters of Texas law, or any order, ruling, or regulation shall have been rendered as to or on behalf of the State of Texas by an official, agency, or department thereof, affecting the tax status of the Corporation, its property or income, its bonds (including the Bonds), or the interest thereon, which in the reasonable judgment of the Underwriters would materially affect the market price of the Bonds. #45232900vi -14- If the Corporation shall be unable to satisfy the conditions to the obligations of the Underwriters to purchase, to accept delivery of, and to pay for the Bonds contained in this Purchase Contract, or if the obligations of the Underwriters to purchase, to accept delivery of, and to pay for the Bonds shall be terminated for any reason permitted by this Purchase Contract, this Purchase Contract shall terminate and be of no further force or effect, and neither the Underwriters nor the Corporation shall be under further obligation hereunder, except that the respective obligations of the Corporation and the Underwriters set forth in Sections 12, 13, 14, 15, and 17 hereof shall continue in fi~ll fBrce and effect. In addition, the Corporation shall promptly return the corporate check of the Authorized Representative delivered to the Corporation pursuant to Section 4 hereof. I I. Particular Covenants of the Corporation. The Corporation covenants and agrees with the Underwriters as follows: (a) Subject to the limitations contained in paragraph 5(1) hereof, the Corporation shall cooperate with the Underxvriters in amending or supplementing the Official Statement whenever requested by the Undetwvriters if, in the reasonable judgment of the Authorized Representative, such amendment or supplement is required. (b) The Corporation shall not revise, amend, or supplement the Official Statement unless such revision, amendment, or supplement has been previously approved by the Authorized Representative. (c) The Corporation shall cooperate with the Underwriters and their counsel in any endeavor to qualify the Bonds for offering and sale under the securities or blue sky laws of such jurisdictions of the United States as the Underwriters may reasonably request, and to maintain such qualifications in effect until the distribution of the Bonds described in the Official Statement shall have been completed; provided, however, the Corporation shall not be required to qualify as a foreign corporation or file a general written consent to suit or to file a general written consent to service of process in any jurisdiction. The Corporation consents to the use of the Bond Resolution, the Preliminary Official Statement, and the Official Statement by the Underwriters in obtaining such qualifications. (d) Any certificate or other instrument or document signed by an authorized officer or agent of the Corporation and delivered to the Underwriters pursuant to the terms and provisions hereof shall be deemed to be a representation and warranty made by the Corporation to the Underwriters as to the statements made therein. (e) From and after the date of this Purchase Contract through and including the time of the Closing, the Corporation will not, without the prior written consent of the Underwriters, issue any additional bonds, notes, or other obligations for borrowed money, incur any material liabilities, direct or contingent, payable from or secured by any of the revenues or assets that will secure the obligations. #43232900vl - 15- (0 If, at any time prior to the time of the Closing as herein provided, an event of which the Corporation has knowledge occurs affecting the Corporation which is materially adverse for the purpose for which the Official Statement is to be used and is not disclosed in the Official Statement, the Corporation shall notify the Authorized Representative, and if, in the opinion of the Corporation and the Authorized Representative, such event requires a supplement or amendment to the Official Statement, the Corporation shall supplement or amend the Official Statement in a fom~ and in a manner approved by the Underwriters, counsel to the Underwriters, and Bond Counsel to the Corporation. 12. Survival of Representations. All representations, warranties, and agreements of the Corporation hereunder or in any certificate delivered pursuant hereto shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Underwriters, and shall survive the delivery of and payment for the Bonds and any termination of this Purchase Contract by the Underwriters pursuant to the terms hereof. 13. Payment of Expenses. Costs related to the issuance and sale of the Bonds, including, but not limited to, costs of preparation, printing, and mailing of the Bonds, the Preliminary Official Statement, and the Official Statement, the fees and expenses of Coastal Securities and Lotus Capital Management, L.L.C., the co-financial advisors to the Corporation, any fees and expenses owed by the City, postage, any costs relating to the redemption of the Refunded Notes, the fees and costs of Paying Agent/Registrar, the cost of obtaining credit ratings on the Bonds, the fees of the Attorney General, the Insurer's premiums for the bond insurance policy and surety bond policy (which may be transmitted by the Authorized Representative to the Insurer as described in Section 1 hereof), any other persons retained by the Corporation relating to this transaction, and the fees and disbursements of Bond Counsel to the Corporation, shall be paid out of the proceeds of the Bonds or other funds of the Corporation. The Underwriters shall pay for their costs related to the purchase of the Bonds, including, without limitation, appropriate advertising expenses and the fees and expenses of their counsel. 14. No Personal Liability. None of the members of the Board, nor any officer, agent, or employee of the Corporation, shall be charged personally by the Underwriters with any liability, or be held liable to the Underwriters under any term or provision of this Purchase Contract, or because of execution or attempted execution, or because of any breach or attempted or alleged breach, of this Purchase Contract. 15. Continuing Disclosure Agreement. The Corporation will agree in the Bond Resolution to provide certain periodic information and notices of material events in accordance with Securities and Exchange Commission Rule 15c2-12, as described in the Official Statement under "CONTINUING DISCLOSURE OF INFORMATION". The Authorized Representative has reviewed the agreement as set forth in the Bond Resolution and the Underwriters' obligation to accept and pay for the Bonds is conditioned upon delivery to the Underwriters or their agent of a certified copy of the Bond Resolution containing the agreement described under such heading. #4~232900v I - 16- 16. Notices. Any notice or other communication to be given to the Corporation under this Purchase Contract may be given by delivering the same in writing at its address set forth above, Attention: Chairperson and any notice or other comnmnication to be given to the Underxvriters under this Purchase Contract may be given by delivering the same in writing to: RBC Dain Rauscher h~c., 1001 Fannin, Suite 700, Houston, Texas 77002 Attention: Mr. Mark Nitcholas. 17. Parties in Interest. This Purchase Contract is made solely for the benefit of the Corporation and the Underwriters (including the successors or assigns of the Underwriters), and no other person shall acquire or have any right hereunder or by virtue hereof. This Purchase Contract shall constitute the entire agreement between us and is made solely for the benefit of the Corporation and the Underwriters (including successors or assigns of the Underwriters) and no other person shall acquire or have any right hereunder or by virtue hereof. This Purchase Contract may not be assigned by the Corporation. All of the Corporation's representations, warranties and agreements contained in this Purchase Contract shall remain operative and in full force and effect, regardless of (i) any investigations made by or on behalf of the Underwriters; (ii) delivery of and payment for the Bonds pursuant to this Purchase Contract; and (iii) any temfination of this Purchase ContracL 18. Governing Law and Choice of Law. This Purchase Contract shall be governed by and construed in accordance with the laws of the State of Texas and the United States of America. 19. Business Day. For purposes of this Purchase Contract, business day means any day on which the New York Stock Exchange is open for trading. 20. Status of the Underwriters. It is understood and agreed that for all purposes of this Purchase Contract and the transactions contemplated hereby the Underwriters have, in their role as underwriters, acted solely as independent contractors and have not acted as a financial or investment advisor, fiduciary or agent to or for the Corporation, whether directly or indirectly through any person. The Corporation recognizes that the Underwriters expect to profit from the acquisition and potential distribution of the Bonds. 21. General. This Purchase Contract may be executed in several counterparts, each of which shall be regarded as an original and all of which will constitute one and the same instrument. The section headings of this Purchase Contract are for convenience of reference only and shall not affect its interpretation. This Purchase Contract shall become effective upon your acceptance hereof and delivery of a signed copy of this Purchase Contract to the Authorized Representative. [Execution page Jbllows.] #45232900vl -17- Ve~x truly yours, RBC DAIN RAUSCHER INC. J.P. MORGAN SECURITIES INC. BY: RBC DAIN RAUSCHER INC. By: Title: Accepted and agreed to as of the date first above written: CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION By: Chairperson, Board of Directors #45232900vl S-1 Maturity (March 1) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 SCHEDULE I PRICING INFORMATION Principal Amount Interest Rate Yield The Bonds shall be dated October 15, 2002 and interest shall accrue from the date of initial delivery of the Bonds to the Underwriters and shall be payable initially on March 1, 2003, and each September I and March I thereafter until stated maturity or prior redemption. The City reserves the right to redeem, prior to maturity, those Bonds maturing on and after March 1,20 , in whole or in part from ti~ne to time, on March I, 20 ._, and on any date thereafter, at a price of par plus accrued interest to the date fixed for redemption, and without premium. #43232900vl Schedule- 1 The City Manager is authorized to secure a bond insurance policy and debt service reserve surety bond policy for the Bonds from for a combined premium not to exceed $ ~4s:3>~1~0~ i Schedule-2 EXHIBIT A ISSUE PRICE CERTIFICATE The undersigned hereby certities with respect to the sale of the "Corpus Christi Business And Job Development Corporation Sales Tax Revenue Refunding and Improvement Bonds, Series 2002 (Arena Project)" in the aggregate original principal amount of $47,540,000 (the "Bon&") as follows: 1. The undersigned is the underwriter or the manager of the syndicate of underwriters which has purchased the Bonds from the Corpus Christi Business and Job Development Corporation (thc "Corporation") at a negotiated sale. 2. The undersigned and/or one or more other members of the underwriting syndicate, if any, have made a bona fide offering to the public of the Bonds of each stated maturity at the respective prices set forth below. 3. The initial offering price (expressed as a percentage of principal amount or yield and exclusive of accrued interest) for the Bonds of each stated maturity at which a substantial amount (at least 10%) of the Bonds of such stated maturity was sold to the public is as set forth below: Principal Amount at Year of Offering Price Stated Maturity ($) Stated Maturity or Yield (%) #4s232900vl A- 1 Principal Amount at Year of Offering Price Stated Maturity ($) Stated Maturity or Yield (%) 4. The ter~n 'Tmblic", as used herein, means persons other than bondhouses, brokers, dealers, and similar persons or organizations acting in the capacity of underwriters or wholesalers. 5. The offering prices described above reflect current market prices at the time of such sales. The CUSIP number of the Bond with the latest stated maturity is 7. The undersigned understands that the statements made herein will be relied upon by the Corporation in its efforts to comply with the conditions imposed by the Internal Revenue Code of 1986, as amended, and by Bond Counsel in rendering their legal opinion concerning the excludability of interest on the Bonds from the gross income of their owners. EXECUTED AND DELIVERED this RBC Dain Rauscher Inc. By: Title: #45232900vl A-2 EXHIBIT B Official Statement #452329110vl B- l EXHIBIT C [Supplemental Opinion of Bond Counsel] November 21, 2002 Corpus Christi Business and Job Development Corporation 1201 Leopard Corpus Christi, Texas 78401 City of Corpus Christi, Texas 1201 Leopard Corpus Christi, Texas 78401 RBC Dain Rauscher Inc., as Authorized Representative of a Group of Underwriters 1001 Fannin, Suite 700 Houston, Texas 77002 Ladies and Gentlemen: We have served as bond counsel to the Corpus Christi Business and Job Development Corporation (the "Corporation") in connection with the issuance of the "Corpus Christi Business and Job Development Corporation Sales Tax Revenue Refunding and Improvement Bonds, Series 2002 (Arena Project)", in the original principal amount of $47,540,000 (the "Bonds") pursuant to the provisions of a resolution duly adopted by the Board of Directors of the Corporation on October 7, 2002 (the "Bond Resolution"). The Bond Resolution, the Financing Agreement, the Purchase Contract, the Project Agreement, and the Agreement are referred to herein as the "Issuer Documents". Capitalized terms not otherwise defined in this opinion have the meanings assigned in the hereinafter defined Purchase Contract. In our capacity as bond counsel to the Corporation, we have reviewed the following: 1. a certified copy of the Bond Resolution; an executed counterpart of the Purchase Contract dated October , 2002 (the "Purchase Contract") between the Corporation and the Underwriters named in such Purchase Contract; an executed counterpart of the Sales Tax Remittance Agreement dated as of October , 2002 (the "Financing Agreement") between the Corporation and the City of Corpus Christi, Texas (the "City"); #45232900vl C- l an executed counterpart of the Project Agreement dated as of October ,2002 (the "Prc~/ect Agreement") between the Corporation and the City; an executed counterpart of the Paying Agent/Registrar Agreement dated as of October ,2002 (the "Agreement") between the Corporation and JPMorgan Chase Bank, Dallas, Texas; 6. a copy of the OfiScial Statement dated October ,2002; '7. the resolution adopted by the City Council of the City on October , 2002 (the "City's Resoh~tion") approving the issuance of the Bonds and authorizing the execution of and approving the Financing Agreement, the Purchase Contract, and the Project Agreement; such other agreements, docmnents, certificates, opinions, letters, and other papers as we have deemed necessary or appropriate in rendering the opinions set forth below; and Texas Revised Civil Statutes Annotated Article 5190.6, as amended (the "Act"), and such other provisions of the Constitution and laws of the State of Texas and the United States of America as we believe necessary to enable us to render the opinions herein contained. in making our review, we have assumed the authenticity of all documents and agreements submitted to us as originals, conformity to the originals of all documents and agreements submitted to us as certified or photostatic copies, the authenticity of the originals of such latter documents and agreements, and the accuracy of the statements contained in such documents. Based upon the foregoing, and subject to the qualifications and exceptions hereinafter set fm~h, we are of the opinion that under the applicable laws of the United States of America and the State of Texas in force and effect on the date hereof: The Corporation has duly adopted and enacted the Bond Resolution in accordance with the Act: the Corporation has full legal right, power, and authority to enter into the Purchase Contract, the Agreement, the Project Agreement, and the Financing Agreement, to adopt the Bond Resolution, and to issue, sell, and deliver the Bonds to the Underwriters as provided in the Purchase Contract; the Corporation has duly authorized and approved the execution and the delivery of, and the performance by the Corporation of the obligations contained in, the Bonds, the Purchase Contract, the Agreement, the Project Agreement, the Financing Agreement, and the Bond Resolution, and all other transactions contemplated by the Official Statement; the Corporation has complied with, and is in compliance with Texas law in all respects regarding, the sale, issuance, and delivery of the Bonds, including the provisions relating to its obligations under the Act, the Bond Resolution, the Bonds, the Project Agreement, the Agreement, the Financing Agreement, and the Purchase Contract; and assuming the due authorization, execution, and delivery by the other contracting #4q232900vl C-2 parties to the Issuer Documents, the Bond Resolution and the Issuer Documents constitute valid, legal, and binding agreements of the Corporation, enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization or other laws relating to or affecting the rights of creditors generally and general equitable principles. 2. The Refunded Notes had been redeemed and are no longer outstanding. The Bonds are not subject to registration under the Securities Act of 1933, as amended, and the Bond Resolution is not required to be qualified under the Trust Indenture Act of 1939, as amended. The statements in thc Official Statement, insofar as they describe the Bonds and the Bond Resolution (except for any financial, technical, or statistical data therein), under the captions "THE BONDS" "REGISTRATION", "TAX MATTERS", "LEGAL INVESTMENTS AND ELIGIBILITY TO SECURE PUBLIC FUNDS IN TEXAS", "CONTINUING DISCLOSURE OF INFORMATION" (except under the subcaption "Compliance with Prior Undertakings" as to which no opinion is expressed) and APPENDIX A are correct as to matters of law and fairly and accurately present the information purported to be presented therein. The City is a home rule municipality, a political subdivision of the State of Texas, and a body politic and corporate, duly created, organized and existing under the laws of the State of Texas, with full authority to authorize the creation of the Corporation and to levy and collect the Sales Tax securing the Bonds for the benefit of the Corporation under the Act. This opinion is furnished solely for your benefit and may be relied upon only by the addressees hereof or anyone to whom specific permission is given in writing by us. Very truly yours, #4)232900v I C-3 EXHIBIT D [Letterhead of Fulbright & Jaworski L.L.P.] November 21, 2002 RBC Dain Rauscher Inc., as Authorized Representative of a Group of Underwriters 1001 Fannin, Suite 700 Houston, Texas 77002 Ladies and Gentlemen: We have acted as your counsel in connection with the purchase by you on this date of $47,540,000 original principal amount of "Corpus Christi Business And Job Development Corporation Sales Tax Revenue Refunding and Improvement Bonds, Series 2002 (Arena Project)" (the "Bond~") pursuant to a Purchase Contract dated October ,2002 (the "Purchase Contract") between you and the Corpus Christi Business and Job Development Corporation (the "Corporation"). This opinion is being furnished to you pursuant to Section 8(h)(3) of the Purchase Contract. Unless otherwise expressly provided herein, capitalized terms used in this opinion shall have the meanings ascribed to them in the Purchase Contract. We have examined a printed copy of each of the Preliminary Official Statement and executed copies of the Bond Resolution, the Financing Agremnent, the Project Agreement, the Paying Agent/Registrar Agreement, the City's Resolution, and the Official Statement, and we have examined and rely upon certain of the certificates and opinions referred to in Section 8(h) of the Purchase Contract. In our examination, we have assumed the authenticity of all documents submitted to us as originals, the conformity to original copies of all documents submitted to us as certified or photostatic copies, the authenticity of the originals of such latter documents, and the accuracy of the statements contained in such certificates. Based upon the foregoing, and subject to the qualifications and exceptions hereinafter set forth, we are of the opinion that under applicable laws of the United States of America and the State of Texas in fome and effect on thc date hereofi 1. The Bonds are exempted securities within the meaning of the Securities Act of 1933, as amended, and it is not necessary in connection with the offer and sale of the Bonds to the public to register the Bonds under the Securities Act of 1933, as amended, or to qualify the Bonds or the Bond Resolution under the Trust Indenture Act of 1939, as amended. We express no opinion as to #45232~)00vl D- 1 any requirements as to the registration of any other security or qualification of any other instrument under such Act. 2. We have not verified the information contained in the Official Statement. However, as your counsel we have participated in discussions with respect to the Official Statement with representatives of the Corporation, McCall, Parkhurst & Horton L.L.P., Bond Counsel, Coastal Securities and Lotus Capital Management, L.L.C., co-financial advisors to the Corporation, and you, and, as stated above, we have reviewed the Official Statement. In the course of such discussions and review, nothing has come to our attention which leads us to believe that the Official Statement [except with respect to the financial statements and other financial and statistical data included therein and in the Appendices thereto, including but not limited to the financial statements appearing in Appendix C thereto (as to which we have not been requested to express a view and as to which we express no view)] contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. In addition to the limitations set forth in the preceding paragraph, we have not been requested to review, nor have we reviewed, any records or contracts of the Corporation or the basis for any representations made by representatives of the Corporation, and the foregoing is subject to the material, statements, and other data contained in the records or contracts of the Corporation and any such representations, to the extent they are reflected in the Official Statement, not containing any untrue statement of a material Pact or omitting to state a material fact necessary to make the statements contained in the Official Statement, in light of the circumstances under which they were made, not misleading. We express no opinion and make no comment with respect to the sufficiency of the security for or the marketability of the Bonds. This opinion is furnished solely for your benefit and may be relied upon only by the addressees hereof or anyone to whom specific permission is given in writing by us. Very truly yours, #45232900vl D-2 EXHIBIT E Opinion of City Attorney November 21, 2002 Corpus Christi Business and Job Development Corporation 1201 Leopard Corpus Christi, Texas 78401 RBC Dain Rauscher Inc., as Authorized Representative of a Group of Under~vriters 1001 Fannin, Suite 700 Houston, Texas 77002 City of Corpus Christi, Texas 1201 Leopard Corpus Christi, Texas 78401 McCall, Parkhurst & Horton L.L.P. 717 North Harwood, Suite 900 Dallas, Texas 75201 Fulbright & Jaworski L.L.P. 300 Convent. Suite 2200 San Antonio, Texas 78205 Coastal Securities 5555 San Felipe, Suite 2200 Houston, Texas 77002 Lotus Capital Management, L.L.C. One Canal Place 365 Canal Street, Suite 1180 New Orleans, Louisiana 70130 Ladies and Gentlemen: i serve as the City Attorney for the City of Corpus Christi, Texas (the "City") and have acted as such in connection with the issuance of an aggregate principal amount of $47,540,000 original principal amount o f"Corpus Christi Business and Job Development Corporation Sales Tax Revenue Refunding and Improvement Bonds, Series 2002 (Arena Project)" (the "Bonds"') pursuant to the provisions of a resolution duly adopted by the Board of Directors of the Corpus Christi Business and Job Development Corporation (the "Cort;oration") on October ,2002 (the "Bond Resolution"). The Bond Resolution, the Financing Agreement, the Purchase Contract, the Project Agreement, and thc Agreement are referred to herein as the lsxz er Doc ~ments . Capitalized terms not otherwise defined in this letter have the meanings assigned in the Purchase Contract dated October ,2002, executed between the City and RBC Dain Ranscher Inc., as the authorized representative of the underwriters (the "Purchase Contract"). In my capacity as City Attorney to the City, l have reviewed the following: 1. a certified copy of the Bond Resolution; 2. an executed counterpar~ of the Purchase Contract; #45232900N I [~- l an executed counterpart of the Sales Tax Remittance Agreement dated as of October ,2002 (the "Financing AgreemenF') between the Corporation and the City; an executed counterpart of the Project Agreement dated as of October ,2002 (the "Preject Agreement") between the Corporation and the City; an executed counterpart of the Paying Agent/Registrar Agreement dated as of October ,2002 between the Corporation and J PMorgan Chase Bank, Dallas, Texas (the "Paying Agent/Registrar Agreement"): 6. a copy of the Official Statement dated October ,2002; the resolution adopted by the City Council of the City on October , 2002 (the "Cio"s Resoh~tion") approving the issuance of the Bonds and authorizing the execution of and approving the Financing Agreement, the Purchase Contract, and the Project Agreement; such other agreements, documents, certificates, opinions, letters, and other papers as I have deemed necessary or appropriate in rendering the opinions set forth below; and Texas Revised Civil Statutes Annotated Article 5190.6, as amended (the "Act"), and such other provisions of the Constitution and laws of the State of Texas and the United States of America as 1 believe necessary to enable me to render the opinions herein contained. In making my review, 1 have assumed the authenticity of all documents and agreements submitted to me as originals, conformity to the originals of all documents and agreements submitted to us as certified or photostatic copies, the authenticity of the originals of such latter documents and agreements, and the accuracy of the statement contained in such documents. Based upon the foregoing, and subject to the qualifications and exceptions hereinafter set forth, 1 am of the opinion that under the applicable laws of the United States of America and the State of Texas in force and effect on the date hereof: The City has duly adopted and enacted the City's Resolution in accordance with the Act; the City has full legal right, power, and authority to enter into the Financing Agreement and the Project Agreement and to adopt the City's Resolution; the City bas duly authorized and approved the execution and the delivery of, and the performance by the City of the obligations contained in the Financing Agreement and the Project Agreement and all other transactions contemplated by the Official Statement; the City has complied with, and is in compliance with Texas law in all respects regarding, the sale, issuance, and delivery of the Bonds, including the provisions relating to its obligations under the Act, the City's Resolution, the Bonds, and the Purchase Contract; and assuming the due authorization, execution, and delivery by the other contracting parties of the Issuer Documents, the City's Resolution and the Issuer Documents constitute valid, legal, and binding agreements #45232900~ I of the City and the Corporation, enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization or other laws relating to or affecting the rights of creditors generally and general equitable principles. The City is a home role municipality, a political subdivision of the State of Texas, and a body politic and corporate, duly created, organized and existing under the laws of the State of Texas, with full authority to authorize the creation of the Corporation and to levy and collect the Sales Tax securing the Bonds tbr the benefit of the Corporation under the Act. The Corporation is a Texas non-profit corporation duly created by the City with the authorization and the approval of the City Council of the City, and is duly organized and validly existing under the provisions of the Act, and is acting on behalf of the City in accordance with such Act. All authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission having .jurisdiction of the matter which are required for the due authorization of, which would constitute a condition precedent to, or the absence of which xvould materially adversely affect the due performance by the Corporation or the City of their obligations under the Issuer Documents, the Bond Resolution, the City's Resolution, and the Bonds have been obtained. Based on reasonable inquiry made of the responsible City employees and public officials, the City and the Corporation are not, to the best of my knowledge, in breach of or in default under any applicable law or administrative regulation of the State of Texas or the United States, or any applicable judg~nent or decree or any trust agreement, loan agreement, bond, note, resolution, ordinance, agreement or other instrument to which the City or the Corporation is party or is othe~wvise subject and, to the best of my knowledge after due inquiry, no event has occurred and is continuing which, with the passage of time or the giving of notice, or both, would constitute such a default by the City or the Corporation under any of the foregoing; and thc execution and delivery of the Bonds and the Issuer Documents and the adoption of the City's Resolution and the Bond Resolution and compliance with the provisions of each of such agreements or instrmnents does not constitute a broach of or default under any applicable law or administrative regulation of the State of Texas or the United States or any applicable judgment or decree or, to the best of my kmowledgc, any trust agreement, loan agreement, bond, note, resolution, ordinance, agreement or other instrument to which the City or the Corporation is a party or is otherwise subject. There is no legislation, action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, commission, government agency, public board or body, pending or, to the best knowledge of the City or the Corporation, after due inquiry threatened against the City or the Corporation, affecting the corporate existence of the City or the Corporation or the titles of its officers to their respective #45232900vl E-3 10. offices, or affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the collection of the Sales Tax pledged to the payment of principal of and interest on the Bonds pursuant to the Resolution or the City's Resolution or in any way contesting or affecting the validity or enforceability of the Bonds, the Issuer Documents, or contesting the exclusion from gross income of interest on the Bonds for federal income tax purposes, or contesting in any way the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto, or contesting the powers of the Corporation or any authority for the issuance of the Bonds, the adoption of the Bond Resolution or the City's Resolution or the execution and delivery of the tssuer Documents, nor, to the best knowledge of the City and the Corporation, is there any basis therefor, wherein an unfavorable decision, ruling or finding would materially adversely affect the validity or enforceability of the Bonds, the Bond Resolution, the City's Resolution, or the Issuer Documents. To the best of my knowledge and belief, the execution and delivery of the Issuer Documents and compliance by the City and the Corporation with the provisions hereof and thereof, under the circumstances contemplated herein and therein, will not conflict with or constitute on the part of the City and the Corporation a material breach of or a default under any agreement or instrument to which the City or the Corporation is a party, or violate any existing law, administrative regulation, order, or consent decree to which the City or the Corporation is subject. By official action the City has taken all steps to duly authorize, levy and collect the Sales Tax and approve the City's Resolution all in accordance with the Act; Except as disclosed in the Official Statement, no litigation is pending, or to my knowledge, threatened, in any court, ( I ) seeking to enjoin the issuance or delivery of the Bonds or the execution and delivery of the lssuer Documents, or in any way contesting or affecting the validity or enforcement of the Bonds, the Issuer Documents, the City's Resolution, or the Bond Resolution, or contesting the powers of the City or the Corporation or any authority for the issuance of the Bonds, the execution and delivery of the lssuer Documents, or the levying of the Sales Tax securing the Bonds, or (2) except as disclosed in the Official Statement, in which a final adverse decision would materially adversely affect the financial condition of the City or the Corporation, or (3) contesting in any way the completeness, accuracy, or fairness of the Official Statement; The statements in the Official Statement under the captions "INTRODUCTION - Description of the Corporation", "INVESTMENT POLICY", and "LITIGATION", and references in other portions of the Official Statement describing the Corporation and the City fairly and accurately summarize in all material respects the matters presented therein, and insofar such information relates to matters of law, is true and correct. #45232900vl E-4 In addition, without having undertaken to determine independently the accuracy and completeness of the statements contained in the Official Statement, during my participation in the preparation of the Official Statmnent nothing has come to our attention which would lead us to believe that the Official Statement (excluding therefrom the financial and statistical data and forecasts included therein) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. This opinion is furnished solely for your benefit and may be relied upon only by the addressees hereof or anyone to whom specific perufission is given in writing by me. Very truly yours, ~45232900vl E-5 ATTEST: Armando Chapa City Secretary / THE CITY OF CORPUS CHRISTI/ / Mayor LEGAL FORM APPROVED JAMES R. BRAY, JR. CITY ATTORNEY ,2002; By: Lisa Aguilar Assistant City Attorney Corpus Christi, Texas 2 Day of The above resolution was passed by the following vote: Samuel L. Neal, Jr. Brent Chesney Javier D. Colmenero Henry Garrett Bill Kelly Rex A. Kinnison John Longoria Jesse Noyola Mark Scott .... U .45