HomeMy WebLinkAbout025681 RES - 03/23/2004RESOLUTION
APPROVING THE RESOLUTION AUTHORIZING THE
ISSUANCE OF BONDS BY THE CORPUS CHRISTI BUSINESS
AND JOB DEVELOPMENT CORPORATION AND THE
EXECUTION OF A SALES TAX REMITTANCE AGREEMENT, A
PROJECT AGREEMENT, AND A BOND PURCHASE
AGREEMENT WITH RESPECT TO THE BASEBALL STADIUM
PROJECT
WHEREAS, Corpus Christi Business and Job Development Corporation (the
"Corporation") was created under the auspices of the City of Corpus Chdsti,
Texas (the "City"); 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 $27,000,000 (the "Bonds"), may be issued for
the purpose of 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 "Sales Tax Remittance Agreement," in substantially the form and
substance as attached hereto 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 Sales Tax Remittance Agreement between
the City and the Corporation.
Section 3. The "Project Agreement" bebNeen 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 4. 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.
ATTEST:
THE CITY OF CORPUS CHRISTI
Armand~
City Secretary
Samuel L. Neal, Jr.
Mayor
APPROVED: /~..'~¢day of ~J , 2004.
City Aior~r~ey ~
Corpus Christi, Texas
The above resolution was passed by the following vote:
Samuel L. Neal, Jr.
Brent Chesney
Javier D. Colmenero
Melody Cooper
Henry Garrett
Rex A. Kinnison
Bill Kelly
Jessie Noyola
Mark Scott
RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS; AND
APPROVING AND AUTHORIZING THE EXECUTION OF A SALES TAX
REMITTANCE AGREEMENT, A PROJECT AGRF, EMENT
AND A BOND PURCHASE CONTRACT AND OTHER MATrERS REI &TED TO THE
ISSUANCE OF THE BONDS
THE STATE OF TEXAS
CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION §
WHEREAS, at an election held on November 5, 2002 (the "Election"), a majority of the
citizens of the City of Corpus Christi, Texas (the "City") voting at the Election authorized the City 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 new and expanded business enterprises
at the rate of one-eighth of one percent to be imposed for 15 years from April 1, 2003 (the
"Economic Development Sales Tax"); and
WHEREAS, at the Election, the citizens of the City approved a proposition that authorized
the use of a portion of the Economic Development Sales Tax for the construction, operation and
maratenance of a minor league baseball stadium (the "Baseball Stadium"); and
WHEREAS, in the proceedings calling the Election, the City made the following findings
with respect to funding the Baseball Stadium from revenues generated by the Economic
Development Sales Tax:
funds could be used for the construction, operation and maintenance of a Baseball
Stadium in the Arena/Convention Center/Port Area of Corpus Christi area (the area
bounded by the Corpus Christi Ship Channel, Corpus Christi Bay, Interstate Highway
37, and Nueces Bay Boulevard, and hereinafter referred to as the "Area") . .
construction of the stadium shall not be commenced unless a binding contract is first
entered into with an entity that:
a) owns a minor league baseball team affiliated with a major league baseball team,
b) has the right to locate such team in the Area, and
c) is obligated under the contract to lease the new stadium and locate the team in the
new stadium; and
WHEREAS, the City Council of the City levied said sales and use tax pursuant to an
ordinance adopted on November 12, 2002, and the collection of said sales and use tax commenced
on April 1, 2003; and
WHEREAS, on February 24, 2004, the City entered into a binding contract with Round Rock
Baseball, Inc. (the "Baseball Team"), evidencing that the Baseball Team owns and has the right to
locate a minor league baseball team affiliated with a major league baseball team in the Area and is
obligated to lease the Baseball Stadium to be constructed in the Area and to locate said minor league
baseball team in the Baseball Stadium~ and
WHEREAS, in the ordinance of the City approving the aforesaid contract, the City Council
made findings to the effect that the development of the Baseball Stadium was consistent with the
propositions approved at the Election, and the Baseball Stadium would foster and encourage
economic development within the City; 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 Development Corporation (the "Issuer"), a nonstock, nonprofit
industrial development corporation created to act on behalf of the City to satisfy the public purposes
set forth in the Act, specifically the purpose of promoting and encouraging employment and the public
welfare, and the undertaking of certain public improvements in accordance with the Act; and
WHEREAS, the Board of Directors of the Issuer finds it necessary and advisable to authorize
the issuance of the hereinafter described bonds for the purposes hereinafter described.
THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CORPUS
CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION THAT:
Section I AMOUNT AND PURPOSE OF THE BONDS The bonds of the Issuer are
hereby authorized to be issued and delivered in the aggregate principal amount not to exceed
$27,000,000 for constructing, operating and maintaining, or causing to be constructed, operated and
maintained a project, to-wit: the Baseball Stadium, and other Costs associated therewith, all as
described in the Project Agreement, for the specific purpose of the promotion and encouragement
of employment and the public welfare,
Section 2 DESIGNATION OF THE BONDS, Each bond issued pursuant to this Resolution
shall be designated: "CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT
CORPORATION SALES TAX REVENUE BOND, SERIES 2004 (BASEBALL STADIUM
PROJECT)", and there shall be issued, sold, and delivered hereunder 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 othervmse on the dates, in the years and in the
principal amounts, respectively, and dated, all as set forth in the Purchase Agreement. The term
"Bonds" as used in this Resolution shall mean and include collectively 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 mean any
of the Bonds.
Section 3 1NTEREST The Bonds shall bear interest calculated on the basis ora 360-day
year composed ot'twelve 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 prior
redemption of the Bonds
Section 4. CHARACTERISTICS OF THE BONDS (a) Registratton and Tranxfer. The
Issuer shall keep or cause to be kept at the principal 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 registrations of transfers 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 Registration Books the address of the registered owner
of each Bond to wluch 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 Agent/Registrar 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 possible and under reasonable circumstances, all transfers of
Bonds shall be made within three business days after request and presentation thereof The Issuer
shall have the right to 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 other,vise required by law, shall not permit their inspection by any other
entity Registration of each Bond may be transferred in the Registration Books only upon
presentation and surrender of such Bond to the Paying Agent/Registrar for exchange or transfer of
registration and cancellation, together with proper written instruments of assignment, in form and
with guarantee of signatures satisfactory to the Paying Agent/Registrar, (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
attorney or representative to evidence an assignment thereof. Upon surrender of any Bonds or any
portion or portions thereof for exchange or transfer of registration, an authorized representative of
the Paying Agent/Registrar shall make such exchange or transfer in the Registration Books, and shall
make notation of such exchange or transfer in the Assignment section appearing on each Bond to the
assignee. The Issuer shall pay the Paying Agent]Registrar's standard or customary fees and charges
for making 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/Registrar shall not be required to make exchange or transfers of registration of any Bond or
any portion thereof(i) during the period commencing with the close of business on any Record Date
and ending with the opening of business on the next following principal 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 "Record Date" shall mean the 15th day
of the month preceding an interest payment date
(b) Ownership of Bonds The entity in whose name any Bond shall be registered in the
Registration Books at any time shall be deemed and treated as the absolute owner thereof for all
purposes of this Resolution, whether or not such Bond shall be overdue, and the Issuer and the
Paying Agent/Registrar shall not be affected by any notice to the contrary; and payment of, or on
account of, the principal 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 satisfy and discharge the
liability upon such Bond to the extent of the sum or sums so paid
(c) Payment of Principal ofBondx attd Interest. The Issuer hereby further appoints the
Paying Agent/Registrar 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/Registrar shall keep proper records of all payments made by the Issuer
and the Paying Agent/Registrar with respect to the Bonds, and of all transfers and exchanges of
Bonds, and all replacements of Bonds, as provided in this Resolution.
(d) Replacement ofBonds¥ Authentication. 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
Bond is replaced, the substitute Bond issued in replacement for such Bond thereof shall be in the
denomination of any integral multiple of $5,000 and have a principal maturity date corresponding to
the maturity date 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/Registrar shall
replace Bonds as provided herein, and each fully registered bond delivered in replacement of any
Bond as penni[ted 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
pursuant to this Resolution is not required to be, and shall not be, authenticated by the Paying
Agent/Registrar, but on each Bond issued in replacement of any Bond or Bonds issued under this
Resolution, there shall be printed a "PAYING AGENT/REGISTRAR'S AUTHENTICATION
CERTIFICATE" (the "Authentication Certificate"), in substantially the form set forth in Section 5
of this Resolution. An authorized representative of the Paying Agent/Registrar shall, before the
delivery of any such Bond, date 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
Paying Agent/Registrar 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 of the
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 delivery
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 Authentication Certificate, the substitute 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 Comptroller of Public Accounts.
(e) Irt General. The Bonds originally issued hereunder and all Bonds issued in replacement
of any 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 prior to their scheduled maturities, (iii) may be exchanged for other Bonds (iv) may be
transferred and assigned, (v) shall have the characteristics, (vi) shall be signed and sealed, and (vii)
the principal of and interest on the Bonds shall be payable, all as provided, and in the manner required
or indicated, in the FORM OF BOND.
(f) Payment of Fees and Charges. The Issuer hereby covenants with the registered owners
of the Bonds that it xwll pay the reasonable standard or customary fees and charges of the Paying
Agent/Registrar for its services with respect to the payment of the principal of and interest on the
Bonds, when due.
(g) Substitute PayingAgent/Registrar The issuer covenants with the registered owners of
the Bonds that at all times wlfile the Bonds are outstanding the Issuer will provide a competent and
legally qualified bank, trust company, financial institution, or other agency to act as and perform the
services of Paying Agent/Registrar for the Bonds under this Resolution, and that the Paying
Agent/Registrar will be one entity. 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 reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less
than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days
prior to the next principal or interest payment dale after such notice In the event that the entity at
any time acting as Paying Agent/Registrar (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, trust 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 Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy
thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying
Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying
Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying
Agent/Registrar to each registered owner of the Bonds, by United States mail, first class postage
prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting
the position and performing as such, each Paying Agent/Registrar 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 AgenffRegistrar
(h) Book-Entry Only ,System The Bonds issued in exchange for the Bonds initially issued
to the purchaser specified herein shall be initially issued in the form of a separate single fully
registered Bond for each of the maturities thereof Upon initial issuance, the ownership of each such
Bond shall be registered in the name 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
With respect to Bonds regtstered in the name of Cede & Co., as nominee of DTC, the Issuer
and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers and
dealers, banks, trust compahies, clearing corporations and certain other organizations on whose behalf
DTC was created ("DTC Participant") to hold securities 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 ownership
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 Participant 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 treat 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 registering transfers
with respect to such Bond, and for all other purposes whatsoever The 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 fully satisfy and discharge
the Issuer's obligations with respect to payment of principal of and interest on the Bonds to the extent
of the sum or sums so paid. No person other than a registered owner, as shown in the Registration
Books, shall receive a Bond certificate evidencing the obligation of the Issuer to make payments of
principal and interest pursuant to this Resolution Upon delivery by DTC to the Paying
Agent/Registrar of written notice to the effect 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 registered 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.
(i) Successor Securities Del~osilory; Tramfers Outside Book-Entry Only System In the
event that the Issuer determines that DTC is incapable of discharging its responsibilities 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 certificated 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
appointment of such successor securities depository and transfer 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 more 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 Registration 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 name or names registered
owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this
Resolution.
(j) Payments, to Cede & Co 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 manner provided in the representation letter of the
Issuer to DTC.
Section 5 FORM OF BONDS The form of all Bonds issued pursuant to tkis Resolution,
including the form of Registration 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 ttfis Resolution, with such appropriate
variations, omissions, or insertions as are permitted or required by tltis Resolution and the Purchase
Agreement.
Section 6. DEFINITIONS As used in this Resolution, the following terms shall have the
meanings set forth below, unless the text hereof specifically indicates otherwise:
"Act" shall mean the Development Corporation Act of 1979, Article 5190.6, V.A.T.C.S., as
amended.
"Additional Bonds" shall mean the additional parity revenue bonds which the Issuer reserves
the right to issue in the future in accordance with Section 22 of this Resolution
"Authorized Investments" means any and all of the authorized investments described in the
Investment Act, provided that such investments are at the time made included in and authorized by
the City's official investment policy approved from time to time by the City Council.
"Board" shall mean the Board of Directors of the Issuer,
"Bond" or "Bond s" shall mean the Corpus Christi Business and Job Development Corporation
S ales Tax Revenue Bonds, Series 2004 (Baseball Stadium Project), in the aggregate principal amount
of $ , authorized to be issued by this Resolution.
"City" shall mean the City of Corpus Christi, Texas. -
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"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 of the Project as provided in the Act, including, without limitation, the cost of the
acquisition of all land, rights-of-way, property rights, easements, and interests, the cost of all
machinery and equipment, financing charges, interest during construction, necessary reserve funds,
cost of estimates and of engineering and legal services, plans, specifications, surveys, estimates of cost
and of revenue, other expenses necessary or incident to determining the feasibility and practicability
of acquiring, constructing, reconstructing, improving, and expanding any such Project, administrative
expense, and such other expense as may be necessary or incident to the acquisition, construction,
reconstruction, improvement, and expansion thereof, the placing of the same in operation, and the
financing of the Project
"Credit Facility" means (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 service on governmental
obligations, provided that a Credit Rating Agency having an outstanding rating on Parity Bonds
would rate the Parity Bonds fully insured by a standard policy issued by the issuer in its highest
generic rating 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 rating 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 financial institution secured the
timely payment of the entire principal amount of the Parity Bonds and the interest thereon.
"Credit Rating Agency" means any nationally recognized municipal securities rating service
from 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 are unconditionally guaranteed by the United States of America,
(ii) noncallable obligations of an agency or instrumentality of the United States of America, including
obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that,
on the date of the purchase thereof are rated as to investment quality by a nationally recognized
investment rating firm not less than AAA or its equivalent, and (iii) noncallable 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 recognized investment rating firm not
less than AAA or its equivalent
"Depository Bank" shall mean the official depository bank of the City~
"Economic Development Sales Tax" shall mean the one-eighth of one percent sales and use
tax authorized at the Election for the Project and levied by the City within the boundaries of the City
as they now or hereafter exist, together with any increases in the aforesaid rate if provided and
authorized by the laws of the State of Texas, including specifically the Act, and collected for the
benefit of the Issuer and the Project, all in accordance with the Act, including particularly Section 4A
thereo£
"Election" shall have the meaning given said term in the preamble to this Resolution.
"Fiscal Year" shall mean the fiscal year of the Issuer, being the twelve month period ending
July 31 of each year.
"Investment Act" shall mean the Public Funds Investment Act of 1987, Chapter 2256, Texas
Government Code, as amended.
8
"lssuer" shall mean Corpus Christi Business and Job Development Corporation,
"MSRB" means the Municipal Securities Rulemaking Board.
"NKMSIR" means each person whom the SEC or its staffhas determined to be a nationally
recognized municipal securities information repository within the meaning of the Rule from time to
time.
"Parity Bonds" shall mean the Bonds and any Additional Bonds hereafter issued.
"Paying Agent/Registrar" shall mean the financial institution so designated in accordance w/th
the provisions of Section 4 of this Resolution.
"Pledged Revenues" shall mean the Economic Development Sales Tax, less any amounts due
or owing to the Comptroller as charges for collection or retention by the Comptroller for refunds and
to redeem dishonored checks and drafts, to the extent such charges and retentions are authorized or
required by law.
"Project" shall mean the costs for the construction, operation and maintenance of the Baseball
Stadium, as further described in the Project Agreement, and the payment of other costs necessary or
incident to the construction of such improvements as permitted by the proposition approved at the
Election, for the specific purpose of the promotion and encouragement of employment and the public
welfare
"Project Agreement" shall mean the Project Agreement between the Issuer and the City, dated
as of April 1, 2004
"Purchase Agreement" means the bond purchase contract between the Issuer and the
Underwriters pertaining to the purchase of the Bonds by the Underwriters.
"Required Reserve Amount" shall mean 1.00 times the average annual principal and interest
requirement of the Panty Bonds; provided, however, that the Required Reserve Amount shall not
exceed 10 percent of the aggregate proceeds (within the meaning of Section 14~(d)(2) of the Code)
of the Parity Bonds.
"Reserve Fund Obligations" shall mean cash, Authorized Investments, and any Credit Facility
(one or more), or any combination of the foregoing
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Cormmssion.
"SID" means any person designated by the State of Texas or an authorized department,
officer, or agency thereof as, and determined by the SEC or its staff to be, a state information
depository witkin the meaning of the Rule from time to time.
"Transfer Agreement" shall mean the Sales Tax Remittance Agreement dated as of April 1,
2004, between the City and the Issuer
"Underwriters" means the syndicate of investment banking firms identified in the Purchase
Agreement; Morgan Keegan & Co, lnc, acts as senior managing underwriter.
Section 7. PLEDGE. The Parity Bonds and any Additional Bonds and any interest payable
thereon, are and shall be secured by and payable from a first lien on and 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 hereinafter provided. The Parity Bonds and any
Additional 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 any time while the Bonds are outstanding and
unpaid such that 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 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 fund entitled
the "Corpus Christi Business and Job Development Corporation Economic Development Sales Tax
Revenue Fund (Baseball Stadium Project)" (hereinafter called the "Revenue Fund"). All Pledged
Revenues shall be credited to the Revenue Fund immediately upon receipt. Monies in the Revenue
Fund shall be maintained at the Depository Bank.
Within the Revenue Fund the Corporation may establish an account for the purpose of
depositing a portion of the Economic Development Sales Tax, consistent w/th 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 transfers
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 capital improvements, orto fund the Debt
Service Fund or the 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 governing body of the City.
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Section 9. DEBT SERVICE FUND For the sole purpose of paying the principal of and
interest 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 Economic Development Sales Tax Revenue Bonds Debt Service Fund
(Baseball Stadium Project)" (hereinafter called the "Debt Service Fund") Monies in the Debt Service
Fund shall be maintained at the Depository Bank
Section 10. RESERVE FUND. (a) Reserve Fund Established. There is hereby created and
established on the books of the Issuer a separate fund entitled the "Corpus Christi Business and Job
Development Corporation Economic Development S ales Tax Revenue Bonds Reserve Fund (Baseball
Stadium 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 Reserve Fund shall be maintained in an amount equal to the Required Reserve Amount. The
chief financial officer of the Issuer may, at the option thereof, withdraw and transfer to the Revenue
Fund all surplus in the Reserve Fund over the Required Reserve Amount.
(b) Reserve Fund Obligations 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 Eligible Investments 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
of 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
Fund 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 ten-as 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 Facility may
be reduced in lieu of such transfer.
(c) Withdrawals from Reserve Ftmd. If the Issuer is required to make a withdrawal fi.om the
Reserve Fund for any of the purposes described in this Section, the chief financial officer of the
Issuer, acting on behalf of the Issuer, shall promptly notify the issuer of such Credit Facility of the
necessity for a withdrawal from the Reserve Fund for any such purposes, and shall make such
withdrawal FIRST from available moneys or Authorized Investments then on deposit in the Reserve
Fund, and NEXT fi-om 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 Facilities shall be determined by the Issuer and
the providers of the Credit Facilities prior to any such drawings being made thereunder.
(d) Credit Facility Draws. In the event there is a draw upon the Credit Facility, the Issuer
11
shall reimburse the provider of such Credit Facility for such draw, in accordance with the terms of
any agreement pursuant to which the Credit Facility is issued, from Pledged Revenues, however, such
reimbursement fi.om Pledged Revenues shall be subject to the provisions of Section 15 hereof and
shall be subordinate and junior in right of payment to the payment of principal of and premium, if any,
and interest on Parity Bonds.
Section 11. CONSTRUCTION FUND. (a) Construction FundEstablixhed. There is hereby
created and established on the books of the Issuer a separate fund entitled the "Corpus Christi
Business and Job Development Corporation Series 2004 Construction Fund (Baseball Stadium
Project)" (hereinafter called the "Construction Fund"). The Construction Fund shall be maintained
at the Depository Bank and shall be subject to and charged with a lien in favor of the registered
owners of' the Bonds until said money on deposit therein are paid out as herein provided. The
proceeds from the sale of the 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
Construction Fund together with such amounts required to fund the cost of the Project after making
required monthly deposits to the Debt Service Fund and Reserve Fund. All interest and profits from
investments made with money in the Construction Fund shall remain on deposit in the Construction
Fund and as part thereof
(b) Disbursemet~t of Funcls Money in the Construction Fund shall be subject to disbursement
by the Issuer for payment of any Cost of the Project Disbursements from the Construction Fund
shall be made by check signed by an officer of said depository bank on behalf of the Issuer. Such
disbursements shall be made only upon the submission ora request by the Issuer, approved by the
City as provided in subsection (c) of this Section, and stating that said purpose for wkich the
disbursement is requested constitutes a valid Cost of the Project.
(c) Approval of Disbur,~'eraet~ts by City The provisions of subsection (b) of this Section
notwithstanding, such officers and employees of the Issuer shall not have authority to request the
disbursement of money from the Construction Fund to pay any such Costs of the Project until the
payment of such Costs has been approved in writing by the chieffinancial officer ofthe City Copies
of invoices and statements with respect.to a disbursement shall be submitted to the chief financial
officer of the City for review thereby prior to the approval of said disbursement request.
Section 12. TRANSFER. (a) TramferAgreement. Pursuant to the provisions of the Transfer
Agreement, the City has agreed to do any and all things necessary to accomplish the transfer of the
Economic Development 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
taxes from the Comptroller, credits and refunds due and owing to the Comptroller, and other matters
with respect to the collection and transfer of the Economic Development Sales Tax. The City shall
maintain the proceeds From the collection of the Economic Development Sales Tax in a trust account
separate from all other funds of the City, with such trust account to be maintained at an official
depository bank of the City
(b) Trans. fer of Money The Chairperson and the Treasurer of the Board are hereby ordered
to do any and all things necessary to accomplish the transfer of monies to the Debt Service Fund in
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ample time to pay the principal of and interest on the Parity Bonds and any Additional Bonds
Section 13. DEPOSITS OF PLEDGED REVENUES; INVESTMENTS (a) Deposits. The
Pledged Revenues shall be deposited in the Debt Service Fund, the Reserve Fund and the
Administrative Expense Fund as hereinafter described, when and as required by this Resolution
(b) Eligible Investmettls Money in any Fund established by this Resolution may, at the option
of the Board, be invested in eligible investment securities as described in the Investment Act; provided
that all such deposits and investments shall have a par value (or market value when less than par)
exclusive of accrued interest at 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
maturing later than the final maturity of the Parity Bonds and any Additional Bonds. Such
investments shall be valued in terms of current market value as of the last day of each year, except
that direct obligations of the United States (State and Local Government Series) in book-entry 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 or any
Additional Bonds.
Section 14. FUNDS SECURED Money in all Funds created 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) Transfers to PayingAgent/Registrar.
Promptly after the delivery of the Bonds, the Issuer shall cause to be transferred to the Paying
Agent/Registrar and deposited to the credit of the Debt Service Fund any accrued interest received
from the sale and delivery of the Bonds, as described in the certificate delivered in accordance with
the provisions of Section 31 hereof, and any such deposit shall be used to pay the interest next
coming due on the Bonds
(b) Transfers to Debt Service Fund. The Issuer shall transfer or cause to be transferred
Pledged Revenues on deposit in the Revenue Fund to the credit of the Debt Service Fund, for transfer
to the Paying Agent/Registrar in the amounts and at the times, as follows:
(1) Such amounts, deposited in approximately equal monthly installments on
or before the 25th day of each month hereafter, commencing with the month during
which the Bonds are delivered, or the month thereafter if delivery is made after the
25th day thereof, as will be sufficient, together with other amounts, if any, then on
hand in the Debt Service Fund and available for such purpose, to pay the interest
scheduled to accrue and come due on the Bonds on the next succeeding interest
payment date.
(2) Such amounts, deposited in approximately equal monthly installments on
or before the 25 th day of each month hereafter, commencing with the month during
which the Bonds are delivered, or the month thereafter if delivery is made after the
25th day thereof, as will be sufficient, together with other amounts, if any, then on
13
hand in the Debt Service Fund and available for such purpose, to pay the principal
scheduled to mature and come due on the Bonds on the next succeeding pnncipal
payment date
Section 16 RESERVE REQUIREMENTS. When and so long as the Reserve Fund
Obligations in the Reserve Fund are not less than the Required Reserve Amount, no deposits need
be made to the credit of the Reserve Fund. When and if the Reserve Fund contains less than the
Required Reserve Amount due to the issuance of the Bonds or any Additional Bonds, beginning on
the 25th day of the month following the delivery of the Bonds to the Underwriters, and continuing
for sixty months, the Issuer shall transfer or cause to be transferred Pledged Revenues on deposit in
the Revenue Fund, and deposit to the credit of the Reserve Fund an amount equal to 1/60 of the
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 from the next available Pledged Revenues, or from
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 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
Required Reserve Amount is funded through the use of a Credit Facility, and the Credit Facility
specifies a termination or expiration date that is prior to the final maturity of the Parity Bonds so
secured thereby, the Issuer shall provide that such Credit Facility shall be renewed 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 t ran twelve (12) months prior to the specified termination or expiration date of the then existing
Credit Facility or (ii) by depositing 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 15 th day of each mo~th, commencing on the 15th day of the month which is twelve (12)
months prior to such termination or expiration date, to restore the Debt Serv/ce Reserve Fund to the
Required Reserve Amount
Section 17. ADM1NIST1LATIVEEXPENSEFUND. Thereis herebycreatedandestablished
on the books of the Issuer, and accounted for separate and apart from all other funds of the Issuer,
a special trust fund entitled the "Corpus Christi Business and Job Development Corporation
Economic Development Sales Tax Administrative Expense Fund" (hereinafter called the
"Administrative Expense Fund"). Money in said Fund shall be maintained at the Depository Bank.
The Issuer shall transfer from the Revenue Fund Pledged Revenues in an amount not exceeding
$15,000 per Fiscal Year into the Administrative Expense Fund after making the required transfers to
the Debt Service Fund and the Reserve Fund (if necessary) in accordance with Section 15 and 16
hereof At no tune shall the Administrative 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, w~thout lirnJtation, the expense of an annual audit, the fees
14
and expenses of the Paying Agent/Registrar and any charges of the City for its administration of any
of the Issuer's affairs.
Section 18. FINDINGS OF ECONOMIC DEVELOPMENT In taking the action to issue
the Bonds as provided in this Resolution, the Board of Directors of the Issuer acts in reliance upon
and adopts the findings of the City as recited in the preamble to this Resolution as they relate to the
economic development of the City resulting from the Project.
Section 19. CONTINUING D1SCLOSUREUNDERTAKING (a)AnrmalReports. (i)
That the Issuer shall provide annually, within six months after the end of each fiscal year ending in
or after 2004, financial information and operating data with respect to the Issuer of the general type
described in Exhibit A hereto provided that such information and data is customarily prepared by the
Issuer Such information shall 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 if none, to each NRMSIR) in lieu of providing such information upon request. Any
financial statements so to be provided shall be (1) prepared in accordance with the accounting
principles described in Exhibit A hereto, or such other accounting principles as the Issuer may be
required 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 within the period during which
they must be provided If the audit of such financial statements is not complete 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 year to each NRMSIR and any SD, when and
if the audit report on such statements become available.
(ii) lfthe 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 information and operating data pursuant to tNs paragraph (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 any document (including an official
statement or other offering document, if it is available from the MSRB) that theretofore has been
provided to the S1D or filed2~ith the SEC.
(b) Material Event Notices The Issuer shall notify any SID and the MSRB, in a timely
manner, of any of the following events with respect to the Bonds, if such event is material within the
meaning of the federal securities laws:
2.
3
4.
5.
6.
7.
8
9.
Principal and interest payment delinquencies;
Non-payment related defaults;
Unscheduled draws on debt service reserves reflecting financial difficulties;
Unscheduled draws on credit enhancements reflecting financial difficulties;
Substitution of credit or liquidity providers, or their failure to perform;
Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
Modifications to rights of holders of the Bonds;
Bond calls;
Defeasances;
15
10. Release, substitution, or sale of property securing repayment of the Bonds; and
I 1. Rating changes.
The Issuer shall notify any S1D and the MSRB, in a timely manner, of any failure by the Issuer to
provide financial information or operating data in accordance with subsection (a) of this Section by
the time required by such subsection
(c) Limitations, Dixclaimers. and Amendments (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 meaning 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 that causes Bonds no longer to be Outstanding
(ii) The provisions of this Section are for the sole benefit of the holders and beneficial owners
of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
equitable right, remedy, or claim hereunder to any other person. The Issuer undertakes to provide
otfly the financial information, operating data, financial statements, 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 presentation of the Issuer's financial
results, condition, or prospects or hereby undertake to update any information provided in accordance
with this Section or otherwise, except as expressly provided herein. The Issuer does not make any
representation 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 SECTION, 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 performing its obligations under this Section
shall comprise a breach of or default under this Resolution for purposes of any other provision of this
Resolution. Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the lssuer under federal and state securities laws
(v) The provisions of this Section may be amended by the Issuer from time to time to adapt
to changed circumstances that arise from a change in legal requirements, a change in law, or a change
in the identity, nature, status, or type of operations of the Issuer, but only if(l) the provisions of this
Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the
primary offering of the Bonds in compliance with the Rule, taking into account any amendments or
interpretations 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 greater amount required by any
16
other provision of this Resolution that authorizes such an amendment) of the outstanding Bonds
consent to such amendment or (b) a person that is unaffiliated with the Issuer (such as nationally
recognized bond counsel) determines that such amendment will not materially impair the interest of
the holders and beneficial owners of the Bonds. If the Issuer so amends the provisions of this
Section, it shall include with any amended financial information or operating data next provided in
accordance with subsection (a) of this Section an explanation, in narrative form, of the reason for the
amendment and of the impact of any change in the type of financial information or operating data so
provided. The Issuer may also amend or repeal the provisions of this continuing disclosure agreement
if the SEC amends or repeals the applicable provision of the Rule or a court of final jurisdiction enters
judgment that such provisions of the Rule are invalid, but only if and to the extent that the provisions
of this sentence would not prevent an underwriter from lawfully purchasing or selling Bonds in the
primary offering of the Bonds
Section 20. PAYMENT On or before September 1, 2004, and semiannually on or before
each March 1 and September I thereafter while any of the Bonds are outstanding and unpaid, the
Paying Agent/Registrar shall make payment of the principal of and interest on the Bonds and the
Additional Bonds to the holders thereof with funds on deposit in the Debt Service Fund and the
Reserve Fund (if necessary).
Section 21. DEFICIENCIES; EXCESS PLEDGED REVENUES. (a) Deficiencies. If on
any occasion there shall not be sufficient Pledged Revenues to make the required deposits into the
Debt Service Fund, the Reserve Fund, and the Administrative Expense Fund, then such deficiency
shall be made up as soon as possible from the next available Pledged Revenues, or from any other
sources available for such purpose
(b) Excess Pledged Revenues Subject to making the required deposits to the credit of the
Debt Service Fund, the Reserve Fund and the Administrative Expense Fund, when and as required
by this Resolution, or any resolution authorizing 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
propositions approved at the Election. Specifically, but not by way of limitation, excess Pledged
Revenues in each year.~n an amount not to exceed $500,000 may be transferred at the direction of
the Board to the City on the last business day of July in each year to be used for affordable housing,
so long as there are projects for which that amount can reasonably be used, as provided in the
propositions approved at the Election.
Section 22. ADDITIONAL BONDS (a) Authority to Issue AdditionalBonds. The Issuer
shall have the fight and power at any time and from time to time and in one or more sehes or issues,
to authorize, issue and deliver additional parity revenue bonds (herein called "Additional Bonds"),
in accordance with law, in any amounts, for purposes of financing ol~projects (including the Project)
under the provisions of the Act, or for the purpose of refunding of any Parity Bonds, Additional
Bonds or other obhgations of the Issuer incurred in connection with the financing of projects 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 outstanding Additional Bonds, from a first lien on and pledge of
the Pledged Revenues
17
(b) Debt Service Fund and Reserve Fund. 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 issued shall 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 principal and interest on said Additional Bonds
then being issued, as the same come due; and that the aggregate amount to be accumulated and
maintained in the Reserve Fund shall be increased (if and to the extent necessary) to an amount not
less than the average annual principal and interest requirements of all Parity Bonds and Additional
Bonds which will be outstanding after the issuance and delivery of the then proposed Additional
Bonds; and that the required additional amount shall be so accumulated by the deposit in the Reserve
Fund of all or any palr of said required additional amount 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 amount (or any balance of said required additional amount not deposited 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
permitted above).
(c) Calculation of Average Annual Debt Servtce. That all calculations of average annual
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) Cond~tiom~)r Issuance of AdditionalBonds' No installment, series or issue of Additional
Bonds shall be issued or delivered unless:
(i) The Chairperson or the Executive Director and the Secretary 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 therein;
(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
(iii) The governing body of the City by official action approves the issuance of the
Bonds, as required by the Act.
18
The foregoing notwithstanding, the Issuer may issue Additional Bonds, all or a portion of the
proceeds ofwkich are to be used to refund all of the outstanding Parity Bonds, without the necessity
of satisfying the provisions of clause (ii) of this subsection.
(e) Addttional Bonds to be Tax-Exempt Obligations. Any installment, series or issue of
Additional Bonds may be issued in such a manner that such Additional Bonds would qualify as
obligations described by Section 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:
(a) Performance. It will faithfully perform at all times any and all covenants, undertakings,
stipulations, and provisions contained in this Resolution and in every Bond; it will promptly pay or
cause to be paid the principal of and interest on every Bond on the dates and in the places and manner
prescribed in this Resolution and the Bonds; and it will, at the times and in the manner preschbed,
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 require 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 court of competent jurisdiction, against the Issuer, its officials and employees, or by the
appointment of a receiver in equity.
(b) LegalAuthority it is a duly created and existing industrial 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 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) Further Encumbrance It, while the Parity Bonds or any Additional Bonds are
outstanding and unpaid, will not additionally encumber the Pledged 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 bonds payable from a subordinate lien on the
Pledged Revenues, in accordance with the provisions of the Act, is specifically recognized and
retained.
(d) Sale or Disposal of Project It, while the Parity Bonds or any Additional Bonds are
outstanding and unpaid, will not sell, convey, mortgage, encumber, lease or in any manner transfer
title 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) Collection of Economic Development Sales Tax (i) The Issuer hereby confirms the
earlier levy by the City of the Economic Development Sales Tax at the rate voted at the Election, and
19
the Issuer hereby warrants and represents that the City has duly and lawfully ordered the imposition
and collection of the Economic Development Sales Tax upon all sales, uses and transactions as are
permitted by and described in the Act throughout the boundaries of the City as such boundaries
existed on the date of said election and as they may be expanded from time to time
(ii) For so long as any Parity Bonds or Additional Bonds are outstanding, the Issuer
covenants, agrees and warrants to take and pursue all action permissible under applicable law to cause
the Economic Development Sales Tax, at said rate or at a higher rate if permitted by apphcable law,
to be levied and collected continuously, in the manner and to the maximum extent permitted by
applicable law, and to cause no reduction, abatement or exemption in the Economic Development
Sales Tax or rate of tax below the rate stated, confirmed and ordered in clause (i) of this subsection
to be ordered or permitted so long as any Parity Bonds or Additional Bonds shall remain outstanding
(iii) If the City shall be authorized hereafter by applicable law to apply, impose and levy the
Economic Development Sales Tax on any taxable items or transactions that are not subject to the
Economic Development 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
Economic Development Sales Tax.
(iv) The Issuer agrees to take and pursue all action permissible under applicable law to cause
the Economic Development Sales Tax to be collected and remitted and deposited as herein required
and as required by the Act, at the earliest and most frequent times permitted by 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.
(f) Recordv. It will keep proper books of record and account in which full, true and correct
emries will be made of all dealings, activities and transactions relating to the Project, the Pledged
Revenues and the Funds created pursuant to tlxis Resolution, and all books, documents and vouchers
relating thereto shall at all reasonable times be made available for inspection upon request of any
bondholders.
(g) Corporate Existence. It will maintain its corporate existence during the time that any
Parity Bonds are outstanding hereunder.
Section 24. DEFEASANCE OF BONDS. (a) DefeasedBond& 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 payment of the principal of such
Bond, plus interest thereon to the due date (whether such due date be by reason 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 AgentJRegnstrar in accordance with an escrow agreement or other
20
similar instrument (the "Future Escrow Agreement") for such payment (1) lawful money of the United
States of America sufficient to make such payment and/or (2) Defeasance Securities that mature as
to principal and interest in such amounts and at such times as will insure the availability, without
reinvestment, 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 Defeased 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 Net 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 contrary, it is hereby provided that any determination not
to redeem Defeased Bonds that is made in conjunction with the payment arrangements specified in
clauses (i) or (ii) above shall not be irrevocable; provided, that in the proceedings providing for such
payment arrangements, the Board expressly (1) reserves the right to call the Defeased Bonds for
redemption; (2) gives notice of the reservation of that right to the owners of the Defeased Bonds
immediately following the making of the payment arrangements; and (3) directs that notice of the
reservation be included in any redemption notices that it authorizes.
(b) Investment in Defeasance Securities' Any moneys so deposited with the Payhag
Agent/Registrar may at the written direction of the Issuer be invested in Defeasance Securities,
maturing in the amounts and times as hereinbefore set forth, and all income from such Defeasance
Securities received by the Paying Agent/Registrar thai 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 writing by the lssuer Any Future Escrow Agreement
pursuant to which the money and/or Defeasance Securities are held for the payment of Defeased
Bonds may contain provisions permitting the investment or reinvestment of such moneys in
Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the
requirements specified in subsections (a)(i) or (ii) oftkis Section. All income from such Defeasance
Securities received by the Paying Agent/Registrar which is not required for the 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) Paying Agent/Regtstrar Services. Until all Defeased Bonds shall have become due
and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such
Defeased Bonds the same as if they had not been released, and the Issuer shall make proper
arrangements to provide and pay for such services as required by this Resolution
(d) Selection of Bonds for Defeasance. In the event that the Issuer elects to defease less
than all of the principal amount of Bonds of a maturity, the Paying AgenffRegistrar 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) ReplacementBon~'. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or
destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new bond
21
of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or
destroyed Bond, in replacement for such Bond in the manner hereinafter provided.
(b) ApplicationforReplacementBonds. Application for replacement of damaged, mutilated,
lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying
Agent/Registrar In every case of loss, theft, or destruction of a Bond, the registered owner applying
for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or
indemnity as may be required by them to save each of them harmless from any loss or damage with
respect thereto, Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall
furnish to the Issuer and to the Paying Agent/Registrar 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) No Default Occurred Notwithstanding the foregoing provisions of this Section, in the
event any such Bond shall have matured, and no default has occurred wkich is then continuing in the
payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may
authorize the payment of the same (without surrender thereof except in the case of a damaged or
mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished
as above provided in this Section.
(d) Charge for Issuing Replacement Bond~'. Prior to the issuance of any replacement bond,
the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing,
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 entitled to all the benefits of this
Resolution equally and proportionately with any and all other Bonds duly issued under this
Resolution.
(e) Authority for lsxuing Replacement Bonds. In accordance with Chapter 1206, Texas
Government Code, this Secfion 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/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bonds
in the form and manner and with the effect, as provided in Section 4(d) of this 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 pertaining to each Bond pending their delivery
and their ~nvest~gatiort, exarmnation, and approval by the Attorney General of the State of Texas, and
22
their registration by the Comptroller of Public Accounts of the State of Texas. Upon registration of
each Bond said Comptroller of Public Accounts (or a deputy designated in writing to act for said
Comptroller) shall manually sign the Comptroller's Registration Certificate on each Bond, and the seal
of said Comptroller shall be impressed, or placed in facsimile, on each Bond The approving 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 replacement of any Bond, but neither shall have any legal effect, and shall be solely for the
convenience and information of the registered owners of the Bonds. In addition, the form of bond
counsel's opinion relating thereto, and an appropriate statement of insurance supplied by a municipal
bond insurance company providing insurance, if any, covering all or any part of the Bonds may be
printed or attached to the Bonds
Section 27. COVENANTS REGARDING TAX EXEMPTION. That the Issuer intends to
issue the Bonds as tax-exempt obligations, and to that end hereby covenants to refrain from any
action which would adversely affect, or to take any action to assure, the treatment of the Bonds as
obligations described in section 103 of the Code, the interest on which is not includable in the "gross
income" of the holder for purposes of federal income taxation. In furtherance thereof, the Issuer
covenants as follows:
(a) to take any action to assure that no more than 10 percent of the proceeds of
the Bonds or the projects financed therewith (less amounts deposited to a reserve fund, if any)
are used for any "private business use", as defined in section 141(b)(6) of the Code or, if more
than 10 percent of the proceeds are so used, that amounts, whether or not received by the
Issuer, with respect to such private business use, do not, under the terms of this Resolution
or any underlying arrangement, directly or indirectly, secure or provide for the payment of
more than 10 percent of the debt service on the Bonds, in contravention of section 14 l(b)(2)
of the Code;
(b) to take any action to assure that 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 financed therewith (less amounts deposited into a reserve fund, if any) then the
amount in excess of 5 percent is used for a "private business use" which is "related" and not
"disproportionate", w~thin the meaning of section 141(b)(3) of the Code, to the governmental
use;
(c) to take any action to assure that no amount which is greater 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), ~s 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 otherwise result in the Bonds
being treated as "private acti,nty bonds" within the meaning of section 14 l(a) of the Code;
23
(e) to refrain from taking any action that would result in the Bonds being
"federally 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 148(b)(2) 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
three years or less until such proceeds are needed for the purpose for which the bonds
are issued,
(2) amounts invested in a bona fide debt service fund, within the meaning
of section 1.148-1 (b) of the Treasury Regulations, and
(3) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed I0 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 requirements of section 148 of the Code (relating to arbitrage) and, to the
extent applicable, section 149(d) of the Code (relating to advance refundings); and
(h) to pay to the United States of America at least once during each five-year
period (beginning on the date of delivery of the Bonds) an amount that is at least equal to 90
percent of the "Excess Earnings", within 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 amount then required to be paid as a result of Excess Earnings under
section 148(f) of the Code
The Issuer understands that the term "proceeds" included "disposition proceeds" as defined in the
Treasury Regulations and, in the case of a refunding bond, transferred 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 hereafter promulgated which modify or expand provisions
of the Code, as applicable to the Bonds, 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 hereafter
promulgated which impose additional requirements which are applicable to the Bonds, the Issuer
agrees to comply with the additional requirements to the extent necessary, in the opinion of
24
nationally-recognized 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 Chairperson, the Executive Director 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 permitted by the Code as are consistent with the purpose for the issuance of the Bonds.
In order to facilitate compliance with the above clause (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 LEMITATION 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 requirements 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 later than three years after the
dale on which the original expenditure is paid The foregoing notwithstanding, the Issuer recognizes
that in order for proceeds to be expended under the Code, the sale proceeds or investment earnings
must be expended no more than 60 days after the earlier of(a) the fifth anniversary of the date of
initial delivery of the Bonds or (b) the date the Bonds are retired. The Issuer agrees to obtain the
advice of a nationally-recognized bond counsel if such expenditure fails to comply w~th the foregoing
to assure that such expenditure will not adversely affect the tax-exempt status 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 nationally-recognized bond counsel to the effect that such failure to comply will not
adversely affect the excludability for federal income tax purposes from gross income of the interest.
Section 29. DISPOSITION OF PROJECT That the Issuer covenants that the property
constituting the Project will not be sold or otherwise disposed in a transaction resulting in the receipt
by the Issuer of cash or other compensation, unless the Issuer obtains an opinion of a nationally-
recognized bond counsel substantially to the effect that such sale or other disposition will not
adversely affect the tax-exempt status of the Bonds. For purposes 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 compensation. For purposes of
this Section, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion of
a nationally-recognized bond counsel to the effect that such failure to comply will not adversely affect
the excludability for federal income tax purposes from gross income of the interest.
Section 30. SALE OF BONDS. (a) Sale of Bonds. 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 Agreement, as shall be determined
by the Executive Director pursuant 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
25
Underwriters, in substantially the form attached hereto and made a part hereof for all purposes, with
such changes as may be necessary to effect the sale of the Bonds to the Underwriters. 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 tluough their duly designated
representative) by 5:00 pm., Friday, April 30, 2004 One Bond in the principal amount maturing on
each maturity date as set forth in the Purchase Agreement shall be delivered to the Underwriters, and
the Underwriters shall have the right to exchange such bonds as provided in Section 4 hereof without
cost.
(b) £arameters wilh Re,peet to Execution of ?urchase Agreement The Executive Director
is hereby authorized, appointed, and designated to act on behalf of the Issuer in selling and delivering
the Bonds and carrying out the other procedures specified in this Resolution, including determining
and fixing the date of the Bonds, any additional or different designation or title by which the Bonds
shall be known, the aggregate principal amount of the Bonds, the date of delivery of the Bonds, the
price at which the Bonds will be sold, the years in which the Bonds will mature, the principal amount
of Bonds to mature in each of such years, the rate 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 mandatory sinking fund
redemption provisions, and all other matters relating to the issuance, sale, and delivery of the Bonds,
including, without limitation, obtaining a municipal bond insurance policy and a debt service reserve
fund surety bond in support of the Bonds, all of which shall be specified in the Purchase Agreement;
provided, that (i) the price to be paid for the Bonds shall not less than 95% of the aggregate original
principal amount thereof, plus accrued interest thereon from the date of their delivery, (ii) none of the
Bonds shall bear interest at a rate greater than 10% per annum and (iii) none of the Bonds shall
mature after March 1, 2018,
(c) Offering Documents Prior to execution of the Purchase Agreement, the Executive
Director, acting for and on behalf of the Issuer, shall cause a preliminary official statement to be
prepared for distribution by the Underwriters to prospective purchasers of the Bonds, such document
to be in substantially the form attached to this Resolution, which form is hereby approved, but with
such changes and completions as the Executive Director may deem necessary or appropriate to enable
the Executive Director, acting for and on behalf of the Issuer, to deem the preliminary official
statement to be final as of its date, except for such omissions as are permitted by the Rule. Within
seven business days after the execution of the Purchase Agreement, the Executive Director, acting
for and on behalf of the Issuer, shall cause a final official statement to be provided to the Underwriters
in compliance with the Rule
(d) Bondlnsurance cmdReserve Fund Insurance 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 amount 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, are incorporated by
26
reference into this Resolution and made a part hereof for all purposes, notwithstanding any other
provision ofthis Resolution to the contrary. The Executive Director ~s 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 prepared by or on behalf of the
Issuer by its financial advisor, shall be deposited to the credit of the various Funds created by tkis
Resolution as set forth in an instruction letter prepared by or on behalf of the Issuer by its financial
advisor to be delivered to the Paying Agent/Registrar at closing. Bond proceeds remaining after the
completion of the Project either shall 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 DOCUMENTS. The Chairperson, Vice Chairperson and
Secretary of the Board of the Issuer, and the Executive Director of the Issuer, and each of them, are
hereby authorized to execute, deliver, attest and affix the seal of the Issuer to all documents and
instruments necessary and appropriate in connection with the issuance, sale and delivery of the Bonds,
including, without limitation, the Transfer Agreement, the Project Agreement, the Paying
Agent/Registrar Agreement, each in substantially the form attached to tkis Resolution, and the
documentation required to obtain the policies from the Insurer described in Section 30(d) above,
including, without limitation, any agree~nent between the Issuer and the Insurer to effect the delivery
of a Credit Facility which constitutes a Reserve Fund Obligation The Chairperson, Vice Chairperson
and Secretary of the Board of the Issuer, and the Executive Director 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, empowered, and directed from time to time and at any time to do and perform all such
acts and things and to execute, acknowledge, and deliver in the name and under the corporate seal
and on behalf of the Issuer all such instruments, whether or not herein mentioned, as may be neces-
sary or desirable in order to carry out the terms and provisions of this Resolution, the Bonds, the sale
and delivery of the Bonds and fixing all details in connection therewath, and to approve any Official
Statement, or supplements thereto, in connection with the Bonds. The Issuer heretofore has executed
a DTC Blanket Letter of Representations with respect to establishing a book-entry-only system of
registration and transfer of bonds and other obligations issued by the Issuer.
Section 33. RULES OF CONSTRUCTION. For all purposes of this Resolution, unless the
context requires otherwise, all references to designated Sections and other subdivisions are to the
Sections and other subdivisions of this Resolution. The words "herein", "hereof' and "hereunder"
and other words of similar import refer to this Resolution as a whole and not to any particular Section
or other subdimsion, Except where the context otherwise requires, terms defined in this Resolution
to impart the singular number shall be considered to include the plural number and vice versa.
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 ex/sts on the date this
Resolution is adopted by the City and any future amendments thereto or successor provisions thereof
Any reference to the payment of principal in this Resolution shall be deemed to include the payment
of any mandatory sinking fund redemption payments as described herein. Any reference to FORM
OF BOND shall refer to the form attached to this Resolution as Exhibit A.
27
Section 34. INTERPRETATIONS. Thetitles and headings of the Sections and subsections
of this Resolution have been inserted for convenience of reference only and are not to be considered
a part hereof and shall not in any way modify or restrict any of the terms or provisions hereof
Section 35. PREAMBLE. The findings and preambles set forth in this Resolution are hereby
incorporated into this Resolution and made a part hereof for all purposes.
28
EXHIBIT A
FORM OF BOND
NO.
PRINCIPAL
AMOUNT
$
UNITED STATES OF AMERICA
STATE OF TEXAS
CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION
SALES TAX REVENUE BOND,
SERIES 2004 (BASEBALL STADIUM PROJECT)
Date of
Interest Rate Maturity Date Original Issue
% April 27, 2004
Cusip No
REGISTERED OWNER:
PRINCIPAL AMOUNT:
DOLLARS
ON THE MATURITY DATE specified above, CORPUS CHRISTI BUSINESS AND JOB
DEVELOPMENT CORPOKATION (the "Issuer"), being a nonstock, nonprofit industrial
development corporation organized and existing under the laws of the State of Texas, including
particularly the Development Corporation Act of 1979, Article 5190.6, V.A.T.C.S., as amended (the
"Act"), and acting on behalf of the City of Corpus Christi, Texas (the "City"), hereby promises to pay
to the registered owner set forth above or to the assignee or assignees thereof (either being
hereinafter called the "registered owner") the principal amount set forth above, and to pay interest
thereon from the date of the original issue specified above, to the maturity date specified above, or
the date of redemption prior to maturity, at the interest rate per mmum specified above with interest
being payable on September 1, 2004 and semiannually on each Marchl and September 1 thereafter;
except that if the date of authentication of this Bond is later than the first Record Date (hereinafter
defined), such phncipal amount shall bear interest from the interest payment date next preceding the
date of authentication, unless such date of authentication is after any Record Date but on or before
the next following interest payment date, in which case such principal 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 the
United States of America, without exchange or collection charges. The principal of this Bond shall
be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or
upon the date fixed for its redemption prior to maturity, at the corporate trust office in Dallas, Texas
(the "Designated Trust Office") of JPMorgan Chase Bank, which is the "Paying Agent/Registrar" for
this Bond The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the
registered owner hereof on the interest payment date by check or draft, dated as of such interest
payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer
required by the resolution authorizing the issuance of the Bonds (the "Resolution") to be on deposit
with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft
shall be sent by the Paying Agent/Registrar by Un/ted States mail, first class postage prepaid, on each
such interest 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/Registrar, as hereinafter described. Any accrued
interest due upon the redemption of this Bond prior to maturity as provided herein shall be paid to
the registered owner at the Designated Trust Office of the Paying Agent/Registrar upon presentation
and surrender of this Bond for redemption and payment at the Designated Trust Office of the Paying
Agent/Registrar The Issuer covenants with the registered owner ofthis Bond that on or before each
principal payment date, interest payment 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 immediately available funds, of all
principal of and interest on the Bonds, when due In addition, interest may be paid by such other
method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the
registered owner. In the event ora non-payment of interest on a scheduled payment date, and for 30
days thereafter, a new record date for such interest payment (a "Special Record Date") will be
established by the Paying Agent/Registrar, if and when funds for the payment of such interest have
been received from the issuer Notice of the Special Record Date and of the scheduled payment date
of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least
five business days prior to the special record date by the United States mail, first-class postage
prepaid, to the address of each owner ora Bond appearing on the Registration 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 interest on this Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which banking institutions in the city where the Designated Trust
Office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then
the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday,
legal holiday, or day 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 payment was due.
Notwithstanding the foregoing, during any period in which ownership of the bonds of this Series is
determined only by a book entry at a securities depository therefor, any payment to the securities
depository, or its nominee or registered assigns, shall be made in accordance with ex/sting
arrangements between the Issuer and the securities depository
THiS BOND is one of an issue of Bonds dated as of April 1, 2004, authorized in accordance
with the Constitution and laws of the State of Texas, including particularly the Act, in the original
principal amount of $ for constructing, operating and maintaining, or causing to be
constructed, operated and maintained, a project, to-wit: the construction ora minor league baseball
stadium, and other Costs associated therewith, for the specific purpose of the promotion and
encouragement of employment and the public welfare
ON __ 1,201 , or any date thereafter, the Bonds of this Series maturing on and after
__ 1, 201_ may be redeemed prior to their scheduled maturities, at the option of the Issuer, with
funds derived from any available source, as a whole, or in part, and, if in part, the maturity or maturi-
ties 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 thereof within
such maturities and in such principal amounts, for redemption (provided that a portion of tkis Bond
may be redeemed only in an integral multiple of $5,000), at the prepayment or redemption price of
the principal amount thereof, plus accrued interest to the date fixed for redemption; provided, that
during any period in which ownership of the Bonds is determined only by a book entry at a securities
depository for the Bonds, if fewer than all of the Bonds of the same maturity and beating the same
interest rate are to be redeemed, the particular 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
of the Resolution, on __ 1, 20__, with respect to Bonds maturing __ 1, 20__, and on
1, 20__, w/th respect to Bonds maturing __ 1, 20 , in the following years and in the following
amounts, at a price equal to the principal amount thereof and accrued and unpaid interest to the date
of redemption, without premium:
Year
Principal Amount
* Final Maturity
The principal amount of the Bonds subject to sinking fund redemption required to be redeemed on
any mandatory sinking fund redemption date shall be reduced at the option of the Issuer by the
principal amount of such Bonds which, at least fifty (50) days prior to the mandatory sinking fund
redemption date, shall have been acquired by the Issuer, and delivered to the Paying Agent/Registrar
for cancellation or shall have been redeemed pursuant to the optional redemption provisions of this
Bond and not previously credited to the mandatory sinking fund redemption; provided, that during
any period in which ownership of the Bonds is determined only by a book entry at a securities
depository for the Bonds, the particular Bonds to be called for mandatory redemption shall be
selected in accordance with the arrangements between the issuer and the securities depository.
AT LEAST 30 days prior to the date fixed for redemption, written notice of such redemption
shall be given by the Paying Agent/Registrar by United States mail, first 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 Agent/Registrar 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 proceedings 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 price for the Bonds which are to be so redeemed, plus accrued
interest thereon to the date fixed for redemption 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 treated as redeemed prior to their scheduled maturities, and they shall
not bear interest after the date fixed for redemption, and they shall not be regarded as being
outstanding except for the right of the registered owner to receive the redemption price plus accrued
interest from the Paying Agent/Registrar out of the funds provided for such payment.
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, transferred and exchanged for a like aggregate pnncipal amount of
fully registered 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 $5,000 as requested in writing by the appropriate registered owner, assignee or
assignees, as the case may be, upon surrender of this Bond to the Paying Agent/Registrar for
cancellation, all in accordance with the form and procedures set forth in the Resolution. Among other
requirements for such assignment and transfer, this Bond must be presented and surrendered to the
Paying Agent/Registrar, together with proper instruments of assigmnent, in form and with guarantee
of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond to the
assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or
are to be transferred and registered The form of Assignment printed or endorsed 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/Registrar's standard or customary fees and
charges for making such transfer, but the one requesting such transfer shall pay any taxes or other
goverranental charges required to be paid with respect thereto. The Paying Agent/Registrar shall not
be required to make transfers of registration of this Bond or any portion hereof(i) during the period
commencing with the close of business on any Record Date and ending with the opening of business
on the next following principal 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.
The registered owner of this Bond shall be deemed and treated by the Issuer and the Paying
Agent/Registrar as the absolute owner hereof for all purposes, including payment and discharge of
liability upon this Bond to the extent of such payment, and the Issuer and the Paying AgenffRegistrar
shall not be affected by any notice to the contrary.
IN THE EVENT any Paying Agent/Registrar 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 w~ll
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 terms and provisions of the Resolution, agrees to be bound by such terms and
provisions, acknowledges that the Resolution is duly recorded and available for inspection in the
official minutes and records of the governing body of the Issuer, and agrees that the terms and
provisions of this Bond and the Resolution constitute a contract between each registered owner
hereof and the Issuer.
WHENEVER the beneficial ownership of this Bond is determined by a book entry at a
securities depository for the Bonds, the foregoing requirements of holding, delivering or transferring
this Bond shall be modified to require the appropriate person or entity to meet the requirements of
the securities depository as to registering or transferring the book entry 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; that this Bond is a special
obligation of the Issuer; that neither the State of Texas, the City, nor any political corporation,
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 interest 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 corporation, subdivision, or agency thereof is pledged to the
payment of the principal of or the interest on this Bond; that the principal of and interest on this
Bond, together with outstanding bonds of the Issuer similarly secured, are secured by and payable
fi.om a first lien on and pledge of certain funds created 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 promotion and
development of new and expanded business enterprises in the City (the "Economic Development
Sales Tax") pursuant to Section 4A of the Act; and that the registered owner hereof shall not have
the right to demand payment of the principal of or interest on this Bond from any tax proceeds other
than the Economic Development 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, subject 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 frotn and secured by a lien on and pledge of the aforesaid Pledged Revenues
1N 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 facsimile 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 placed in facsimile, on this Bond.
(signature)
Secretary,
Board of Directors
(signature)
Chairperson,
Board of Directors
(SEAL)
FORM OF REGISTRATION CERTIFICATE OF
THE COMPTROLLER OF PUBLIC ACCOUNTS*:
COMPTROLLER'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
Witness my signature and seal this
(COMPTROLLER'S SEAL)
Comptroller of Public Accounts
of the State of Texas
* To be printed only on the Bonds submitted 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 accomparded 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
described 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 originally was approved by the
Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the
State of Texas.
Dated:
JPMorgan Chase Bank
By
Authorized Representative
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 AgenffRegistrar's Registration Books
with full power of substitution in the premises.
Dated
Signature Guaranteed:
NOTICE: Tkis signature must be guaranteed by a member of the New York Stock Exchange
or a commercial bank or trust company.
Registered Owner
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
whatsoever.
A statement of insurance furnished by the Insurer (as defined in Section 30(d) of the Bond
Resolution) with respect to the municipal bond insurance 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 this Resolution.
Annual Financial Statements and Operating Data
The financial 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 Statement referred to) below:
1 The information of the general type included in tables 1 through 4, inclusive.
2 Appendix C to the Official Statement,"Financial Statements of the Corpus Christi
Business and Job Development Corporation"
Accounting Principles
The accounting principles referred to in such Section are the accounting principles described
in the notes to the financial statements referred to in paragraph 2 above.
SALES TAX REMYUFANCE AGREEMENT
THIS SALES TAX REMITTANCE AGREEMENT, dated as of April 1, 2004, executed by
and between the City of Corpus Christi, Texas (the "City") and'the Corpus Christi Business and Job
Development Corporation (the "Corporation")
W1TNESSETH:
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, at an election held on November 5, 2002 (the "Election"), a majority of the
citizens of the City of Corpus Christi, Texas (the "City") voting at the Election authorized the City
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 new and expanded business enterprises
at the rate of one-eighth of one percent to be imposed for 15 years from April 1, 2003, (the
"Economic Development Sales Tax"); and
WHEREAS, und er the Act and the provisions of the Texas Tax Code, disbursements of sales
and use taxes are made to cities, such as the City, by the Comptroller of Public Accounts of Texas
(the "Comptroller"); and
WHEREAS, under authority of the Act, it is the intent of the Corporation to issue bonds for
the purpose of financing eligible projects under the Act, particularly Section 4Athereof, and to secure
said bonds with the Economic Development Sales Tax collected by the City under authority of
Section 4A of the Act and the Election; and
WHEREAS, the parties hereto find it necessary and advisable to enter into tiffs Agreement
to evidence the duties and responsibilities of the respective parties with respect to the collection,
remittance and transfer of such sales and use tax revenues.
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:
ARTICLE I
SALES TAX FUND
Section 1,1. Creation of Fund. The City agrees to establish and maintain at an official
depository bank of the City (the "Depository"), an escrow fund to be entitled "Corpus Christi
Business and Job Development Corporation Economic Development Sales and Use Tax Fund" (the
"Sales Tax Fund"). The Sales Tax Fund shall be maintained as a separate fund at the Depository, and
no other moneys of the City shall be commingled with the Sales Tax Fund.
Section 1.2 Deposits toFund. TherevenuesreceivedbytheCityfi-omtheComptrollerfrom
the charge and levy of the Economic Development Sales Tax shall be deposited as received, or
transmitted by the Comptroller directly, to the credit of the Sales Tax Fund, for the benefit of the
Corporation, and shall be mad e available to the Corporation from time to time as hereinafter provided
in this Agreement.
Section 1.3 Security for Fund The City hereby agrees that moneys on deposit in the Sales
Tax Fund shall at all times be collateralized in the manner and with the collateral required by the City
for its own funds
Section 1.4 Chan~e in Depository The City reserves the right from t~me to time to change
its official depository bank, and hereby agrees to give the Corporation thirty (30) days prior written
notice of any such change in its official depository bank
ARTICLE II
TRANSFER OF FUNDS
Section 2.1 Collection of Economic Development Sales Tax (a) Until the Comptroller is
able to deter~nine and report the amount of the Economic Development Sales Tax levied for the
benefit of the Corporation and any rebate, charge-back or adjustment thereof on a point of collection
basis, the City will allocate a portion of the undivided sales and use tax receipts to the Corporation
on the basis of the total sales and use taxes collected, multiplied by the pro rata portion of the
Economic Development Sales Tax and divided by all other sales and use taxes received from the
Comptroller by the City. In addition, the City will allocate the costs of any rebate or charge-back
applicable to the undivided sales and use tax receipts between the City and the Corporation on a pro
rata basis.
(b) The Chairperson of the Board of Directors of the Corporation and the Director of
Financial Services of the City shall take such actions as are required to cause the Economic
Development Sales Tax to be delivered and transferred by the Comptroller to the City for use by the
Corporation by the fastest and most economically feasible means available.
Section 22 Revenue Fund By resolution adopted by the Corporation on March 22, 2004
(the "Bond Resolution"), the Corporation established with the City's depository bank a fund
designated in the Bond Resolution as the "Revenue Fund".
Section 2.3. Transfers to Revenue Fund On or before the 25th day of each month, the City
shall direct the Depository to transfer funds on deposit in the Sales Tax Fund to the credit of the
Revenue Fund, on behalf of the Corporation. The City shall cause the Depository to make such
transfers within twenty-four (24) hours of receipt of such direction to the extent that there are moneys
on deposit in the Sales Tax Fund to effect such transfer.
-2-
Section 2.4. Use of Money by Corporation The Corporation agrees to use the moneys on
deposit in the Revenue Fund in a manner consistent with the terms and conditions of the Bond
Resolution.
Section 25 Covenant of the City Recognizing that the Economic Development Sales Tax
shall provide the security for the Corporation's bonds issued for the Baseball Stadium (as defined in
the Bond Resolution), so long as such bonds are outstanding, the City covenants and agrees that it
will take and pursue all possible action permitted by the Act and other applicable State law to cause
the Economic Development Sales Tax to be levied and collected continuously at the rate of one-
eighth of one percent or, to the extent permitted by law and necessary or desirable, a~ a higher rate,
and the City will not cause a reduction, abatement or exemption in the Economic Development Sales
Tax or in the rate at wkich it is authorized to be collected
ARTICLE III
MISCELLANEOUS
Section 3.1. Depository Responsibilities The Chairperson of the Board of Directors of the
Corporation and the Director of Financial Services of the City shall develop procedures to ensure that
the official depository bank of the City, as it may exist from time to time, shall be obligated to
perform the duties detailed in this Agreement, and to that end the City agrees to incorporate into its
agreement with its official depository bank a covenant by the official depository bank that it will
perform all duties and obligations as a depository as set forth in this Agreement and in the Bond
Resolution.
Section 32 Fees of Depository In connection with the establishment and maintenance of
the Sales Tax Fund, the Corporation agrees, subject to making the payments required by the
provisions of the Bond Resolution pertaining to the funding of debt service and reserve requirements
for the Corporation's bonds, to pay the reasonable costs and expenses of the Depository associated
with the adnunistration of the Sales Tax Fund and such costs and expenses, if any, shall never
constitute a cost, liability, or obligation of the City
Section 3.3. Severabilitv. Ifar~y clause, provision, or section of this Agreement should be
held illegal or invalid by any court of competent jurisdiction, the invalidity of such clause, provision,
or section shall not affect any of the remaining clauses, provisions, or sections hereof and this
Agreement shall be construed and enforced as if such illegal or invalid clause, provision, or section
had not been contained herein. In case any agreement or obligation contained in this Agreement
should be held to be in violation of law, then such agreement or obligation shall be deemed to be the
agreement or obligation of the City and the Corporation, as the case may be, to the full extent
permitted by law
-3-
1N WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed in
multiple counterparts, each of which shall be considered an original for all purposes, as of the day and
year first set out above
CITY OF CORPUS CHRISTI, TEXAS
ATTEST:
By
City Manager
City Secretary
(CITY SEAL)
CORPUS CHRISTI BUSINESS AND
JOB DEVELOPMENT CORPORATION
ATTEST:
By
Chairperson, Board of Directors
Secretary, Board of Directors
_..?..--'
,,?,,¢ ·. ...... -~ ,,
PROJECT AGREEMENT
THIS PROJECT AGREEMENT dated as of April 1, 2004, (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, at an election held on November 5, 2002 (the "Election"), a majority of the
citizens of the City of Corpus Christi, Texas (the "City") voting at the Election authorized the City
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 new and expanded business enterprises
at the rate of one-eighth of one percent to be imposed for 15 years fi.om April 1, 2003, (the
"Economic Development Sales Tax"); and
WHEREAS, under authority of the Act, it is the intent of the Corporation to issue bonds (the
"Bonds") for the purpose of financing eligible projects under the Act, particularly Section 4A thereof,
and to secure said bonds with the Economic Development 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
the "Baseball Stadium" and for maintenance and operating costs of the Baseball Stadium for the life
thereof(as so defined in the Resolution, the "Project") and the Corporation and the City have entered
into a sales tax remittance agreement (the "Sales Tax Remittance Agreement") for the purpose of
providing a mechanism for distributing the Econom/c Development 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 I 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, 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 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, admimstrative, 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 Bonds will be issued by the Corporation in the
amount of $ , which amount, together with any cash contribution from the Corporation,
is now estimated to be sufficient to cover all the aforesaid costs and expenses and other amounts
required. However, should the Bond proceeds be insufficient for such purpose, the Corporation may
use Economic Development Sales Tax revenues, to the extent they are in excess of amounts needed
to pay debt service on the Bonds and to fund and maintain a reserve fund, to complete the Project
in accordance with Section 11 of the Resolution and in accordance with Section 4 hereo£
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 acquihng, 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 and any cash contribution from the Corporation. The
Corporation shall deposit the proceeds from the sa~e of the Bonds into the Constraction Fund in
accordance ~vith 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 w~ll 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 serv/ces of the
Project paid for and acquired by the Corporation pursuant to this Contract. It is agreed that the City
always shall have control of the Project and its uses, including entering into long-term lease
agreements with respect to the 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 or causing the Project to be operated
and maintained, and that funds for such purpose shall be made available to the City by the
Corporation from the Economic Development Sales Tax, consistent with the proposition authorizing
the levy and collection of the Economic Development Sales Tax approved by the citizens of the City
at the November 5, 2002 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, all 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 Economic Development Sales Tax revenues to the Corporation as required under the Sales
Tax Remittance Agreement.
Section 9 REGULATORY BODIES This Contract and the Project shall be subject to all
valid rules, regulations, and laxvs applicable thereto passed or promulgated by the United States of
ganerica, the State of Texas, or any governmental body or agency having lawful jurisdiction or any
authorized representative or agency of any of them.
Section 10 TERM OF CONTRACT That the term oftkis Contract shall be for the period
during which the Bonds or any interest thereon are outstanding and unpaid.
]Execution Page Follows]
4
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 I st day of April, 2004, which is the date of this
Contract.
CITY OF CORPUS CHRISTI, TEXAS
ATTEST:
By
City Manager
City Secretary
(CITY SEAL)
CORPUS CHRISTI BUS1NESS AND
JOB DEVELOPMENT CORPORATION
ATTEST:
By
Chairperson, Board of Directors
Secretary, Board of Directors
,,.?'~ ~s//'i.,,'
(c~(~~
>,%"'.2 ..... '¥
'"",g?,T&'
$25,340,000'
CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION
SALES TAX REVENUE BONDS, SERIES 2004
(BASEBALL STADIUM PROJECT)
PURCHASE CONTRACT
Apfill,2004
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 1 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 $25,340,000*
original principal amount of CORPUS CHRISTI BUS[NESS AND JOB DEVELOPMENT
CORPORATION SALES TAX REVENUE BONDS, SERIES 2004 (BASEBALL STADIUM
PROJECT) (the "Bonds"). The Bonds shall be dated April 1, 2004 and shall have the stated
maturities, be offered at the prices, and bear interest at the rates per annum all as set forth in the
Official Statement (hereinafter defmed). Interest on the Bonds shall accrue fi.om the date of
Closing (hereafter defined) and will be payable initially on September 1, 2004 and on each
March 1 and September 1 thereafter. In addition, the authorization for the Executive Director of
the Corporation (the "Executive Director") to obtain a municipal bond insurance policy for the
Bonds and a surety bond policy for the Reserve Fund for the Bonds is further described in
Schedule I attached hereto. As provided in the Bond Resolution (hereafter defmed), the
Executive Director has been authorized by the Board of Directors of the Corporation to execute
' Preliminary, subject to change.
45421446.2
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. Since a municipal bond
insurance policy and a surety bond policy for the Reserve Fund have been obtained by the
Corporation, the Underwriters, on behalf of the Corporation, 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.
This amount shall reduce the purchase price for the Bonds and is being transferred to the Insurer
by the Authorized Representative on the date of the Closing 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 March 22, 2004 authorizing their issuance and
sale (the "Bond Resolution ") 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.
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 Economic Development Sales Tax fi.om the City to the Corporation and a
Project Agreement (the "Project Agreement") relating to the construction and transfer of the
Project from the Corporation to the City.
Morgan Keegan & Company, 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 Offerim,. 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 inside cover
page 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 dealers (including dealers depositing Bonds
into investment masts) 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.
45421446.2 -2-
3. Official Statement. The Bonds are described in the £mal Official Statement dated
the date hereof, a substantially final version of which is attached hereto as Exhibit B. Such fmal
Official Statement, together with 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 Prehminary Official
Statement dated March __, 2004 relating to the Bonds (the "Preliminary Offctal 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 or the Executive
Director of a Rule 15c2-12 Certificate pertaining to the distribution of the Preliminary Official
Statement.
4. Security 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
$260,000. The Corporation agrees to hold such check uncashed until the Closing to ensure the
performance 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 mason permitted by this Purchase Contract, such check shall immediately be
returned to the Authorized Representative. In the event the Underwriters 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 shall constitute a full release and
discharge of all 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
4~21~6.2 -3-
additional damages fi.om 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. Rel>resentations 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 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 purposes 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 and the Project Agreement, (ii) to execute, deliver, and
perform its obligations under this Purchase Contract, the Project Agreement, and the
Financing Agreement, and (iii)to consummate 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 of a material fact and does not omit and will
not omit 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) [he issuance and sale of the Bonds upon the terms set forth herein and in the
Official 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 Agreement, and the Financing Agreement.
(f) The Bond Resolution and the Financing Agreement are and, on the date of
the Closing, will be in full force and, on the date of Closing, 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,
454214462 4-
assuming the due authorization, execution, and delivery of such instruments by the other
parties thereto and their authority to perform such instruments, 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 behalf of the 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 oftbe 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, tlxis 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 Economic Development 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 admirdstrative 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.
(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 inslamments, 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
-5-
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 permits, 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 1 l(c) hereof, shall have been duly made or obtained on
or before the date of the Closing), no permit, consent, hcense, 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 inslruments
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 the 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
conformity with generally accepted accounting principles applied on a consistent basis
throughout the periods presented.
(1) If, after the date of this Pttrchase 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 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 fi.om 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 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 maimer 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 supplamented will not,
contain any untrue statement of a 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.
45421446.2 -6-
(m) Between the date of this Pttrchase 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.
(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") ia 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 "Till2 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
conforms to the description thereof contained in the Official Statement under the caption
"CONTINUING DISCLOSURE OF INFORMATION."
(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 Economic Development 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.
45421446.2 -7-
(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 mtmicipal securities information
rq~ository. Unless otherwise notified in writing by the Authorized Representative, the
Corporation can assume that the end of the underwriting period for purposes of Rule 15c2-12 is
the date of the Closing.
7. Delivery of, and Pawnent 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 April 27, 2004, 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. It 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 Cede & Co., as the registered owner and nominee for The Depository Trust
Company, New York, New York ("DTC") 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 defmitive Bonds shall be in fully registered form, bear proper
CUSIP numbers, and be in authorized denominations and registered in such names and in such
mounts 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 fieu of the foregoing, such Bonds shall be held in safe custody by the paying
agent/registrar or a~y 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
4~21~6.2 -8-
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 Underwriters 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
U-ue 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 performed and complied with all agreements
and conthtions required by tkis 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, the Project Agreement
and the Financing Agreement shall be in full force and effect, and neither the Bond
Resolution, the Project Agreement nor the Financing Agreement shall have been
amended, modified, or supplemented, and the Official Statement shall not have been
amended, modified, or supplemented, 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.
(e) The Corporation shall not have failed to pay principal or interest when due
on any of its outstanding 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 restxaint,
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 cormection with the transactions described in this
Purchase Contract shall be reasonably satisfactory in legal form and effect to counsel for
the Underwriters.
(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
454214445.2 -9-
the form attached in the Official Statement as Appendix D relating to the Bonds;
provided, however that such opinion may be modified, if deemed necessary by
Bond Counsel and subject to Section 10 (xii) of this Purchase Contract, as a result
of the final promulgation of Internal Revenue Service Circular 230, 68 Fed. Reg.
75,186 (2003) (to be codified at 31 C.F.R. pt. 10) ("Circular 230");
(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 m
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 satisfactory 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 a duly authorized officer or official 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 the 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, 2003;
(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 tree, 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"),
45421446.2 -10-
relating to the legality and validity of the Bonds, 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 a duly
authorized officer or official 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 admiuistrative body, or to his knowledge threatened, that seeks to
restxain 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 Economic Development Sales Tax 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 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 member 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 Prelknmary Official
Statement (to the extent not modified by the Official Statement) or the Official
Statement; 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 mount
equal to the principal of and interest on the Bonds and a surety bond policy
45~1~6.2 -11-
relating to the Reserve Fund, along with the customary closing certificates
executed by the Insurer;
(15) a certificate of the City, dated the date of Closing and signed on its
behalf by a duly authorized officer or official of the City, acting solely in his
official capacity, in form satisfactory to Bond Counsel and counsel to the
Underwriters, to the effect that the November 5, 2002 election authorizing the
imposition of the Economic Development Sales Tax was duly held and conducted
and that preclearance of this election by the United States Dc'pa.tment of Justice
was obtained;
(16) a certificate from the authorized representative of the City relating
to certain matters with respect to the City, the Economic Development 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; and
(18) the resolution adopted by the City Cotmcil of the City on
March 23, 2004 (the "City's Resolution") approving the Project Agreement, the
Financing Agreement and the issuance of the Bonds.
(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 truth and accuracy, as of the time of Closing, of the re'presentations 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 Underwriters 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 Oblieations of the Corporation. The obligations of the Corporation
hereunder to deliver the Bonds shall be subject to receipt on or before the date of the Closing of
454214~6.2 -12-
~he purchase price set forth in Section 1 hereof, the opimon of Bond Counsel described in
Section 8(h)(1) hereof, and the opinion of the Attorney General of Texas 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 committee 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 Underwriters, either (a) makes untrue or incorrect
in any material and adverse respect any statement or information contained in the Official
Statement or Co) 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)them shall have occurred any national or intemational calamity or crisis, including,
without limitation, f'mancial 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 bankruptcy laws by
or against the State of Texas or any political subdivision, agency, or instrumentality of the State
of Texas, the effect of which on the t-mancial markets of the United States being such as, in the
reasonable judgment of the Underwriters, would make it impracticable for the Underwriters 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 requiting 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,
45421446.2 - 13 -
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 for 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, or (xii) as a result of the final promulgation of Circular 230, the opinion of Bond
Counsel delivered varies materially from the form or substance of the Bond Counsel opinion
attached to the Official Statement such that, in the opinion of the Authorized Representative,
reasonably exercised, the marketability of the Bonds or the market price of the Bonds is
adversely affected.
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 full force 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.
11. 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 Underwriters in amending or supplementing the
Official Statement whenever requested by the Underwriters 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
-14-
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 Bonds.
(f) 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 form
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 Exoenses. 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, the financial advisor to the Corporation, any fees and expenses owed by the City,
postage, the fees and costs of Paying AgenffRegistrar, 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 I 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.
45421446.2 = 1 5 -
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. Continuin~ Disclosure A~reement. 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.
16. Notices. Any notice or other commtmication 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 communication to be given to the
Underwriters under this Purchase Contract may be given by delivering the same in writing to:
Morgan Keegan & Company, Inc., 5956 Sherry Lane, Suite 1900, Dallas, Texas 75225
Attention: Mr. Tom Oppenheim.
17. Parties in Interest. This Pttrchase 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
termination of this tharchase Contract.
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 distaSbution of the Bonds.
45421446.2 - 1 6-
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 follows.]
4~21~62 -17-
Very truly yours,
MORGAN KEEGAN & COMPANY, INC.
RBC DAIN KAUSCHER INC.
BANC OF AMERICA SECURITIES LLC
MORGAN KEEGAN & COMPANY, INC.
By:
Title:
Accc-pted and agreed to as of
the date fi_mt above written:
CORPUS CHRISTI BUSINESS AND
JOB DEVELOPMENT CORPORATION
By:
Executive Director
45421446.2 S-1
Maturity (Seotember 1)
SCHEDULE 1
PRICING INFOKMATION
Princioal Amount Interest Rate
Yield
The Bonds shall be dated April 1, 2004 and interest shall accrue from the date of initial
delivery of the Bonds to the Underwriters and shall be payable initially on September 1, 2004,
and each March 1 and September 1 thereafter until stated maturity or prior redemption.
The City reserves the right to redeem, prior to maturity, those Bonds maturing on and
after September 1 in whole or in part from time to time, on September 1, , and on any
date thereafter, at a price of par plus accrued interest to the date fixed for redemption, and
without premium.
THE BONDS are also subject to mandatory redemption in part by lot pursuant to the
terms of the Resolution. on September 1 in each of the years __ and __, with respect to
Bonds maturing September 1, __, in the following years and in the following amounts, at a
45421446.2 Schedule I
price equal to the principal amount thereof and accrued and unpaid interest to (but excluding) the
date of redemption, without premium:
Yea[
Principal Amount ($)
* Final Maturity
The principal amount of the Bonds subject to sinking fund redemption required to be
redeemed on any mandatory sinking fund redemption date shall be reduced at the option of the
Issuer by the principal amount of such Bonds which, at least fifty (50) days prior to the
mandatory sinking fund redemption date, shall have been acquired by the Issuer, and delivered to
the Paying Agent;Registrar for cancellation or shall have been redeemed pursuant to the optional
redemption provisions of this Bond and not prewously credited to the mandatory sinking fund
redemption; provided, that during any period in which ownership of the Bonds is determined
only by a book entry at a securities depository for the Bonds, the particular Bonds to be called
for mandatory redemption shall be selected m accordance with the arrangements between the
Issuer and the securities depository.
The Executive Director 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 $
45421446 2 Schedule I
EXHIBIT A
ISSUE PRICE CERTIFICATE
The undersigned hereby certifies with respect to the sale of the "Corpus Christi Business
And Job Development Corporation Sales Tax Revenue Bonds, Series 2004 (Baseball Stadium
Project)" in the aggregate original principal amount of $ (the "Bonds '3 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 (the "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
Stated Maturity ($)
Year of
Stated Maturity
Offering Price
or Yield (%)
45~1~6.2 A-1
Principal Amount at Year of Offering Price
Stated Maturity ($) Stated Maturity or Yield (%)
4. The term "public ", as used herein, means persons other than bondhouses, brokers,
dealers, and similar persons or organizations acting in the capacity of underwriters or
wholesalers.
such sales.
6.
7.
The offering prices described above reflect current market prices at the time of
The CUSIP number of the Bond with the latest stated maturity is.
The undersigned understands that the statements made herein w/Il 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 fi.om the gross income of their owners.
EXECUTED AND DELIVERED this
Morgan Keegan & Company, Inc.
By:
Title:
45421446 2 A-2
EXHIBIT B
Official Statement
45421446.2 B-1
EXItlBIT C
[Supplemental Opinion of Bond Counsel]
April 27, 2004
Corpus Christi Business
and Job Development Corporation
1201 Leopard
Corpus Christi, Texas 78401
City of Corpus Christi, Texas
1201 Leopard
Corpus Christi, Texas 78401
Morgan Keegan & Company, Inc.,
as Authorized Representative of
a Group of Underwriters
5956 Sherry Lane, Suite 1900
Dallas, Texas 75225
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 Bonds, Series 2004 (Baseball Stadium
Project)", in the original principal amount of $ (the "Bonds") pursuant to the
provisions of a resolution duly adopted by the Board of Directors of the Corporation on March
22, 2004 (the "Bond Resolution "). The Financing Agreement, the Purchase Contract, the Project
Agreement, and the Paying Agent Agreement are referred to herein as the "Issuer Documents ".
Capitalized terms not otherwise de£med 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;
2. an executed counterpart of the Purchase Contract dated April 1, 2004 (the
"Purchase Contract'') between the Corporation and the Underwriters named in such Purchase
Contract;
3. an executed counterpart of the Sales Tax Remittance Agreement dated as of April
1, 2004 (the "Financing Agreement'') between the Corporation and the City of Corpus Christi,
Texas (the "City");
4. an executed counterpart of the Project Agreement dated as of April 1, 2004 (the
"Project Agreement") between the Corporation and the City;
5. an executed counterpart of the Paying Agent/Registrar Agreement dated as of
April 1, 2004 (the "Paying Agent Agreement") between the Corporation and JPMorgan Chase
Bank, Dallas, Texas;
454214462 C-1
6. a copy of the Official Statement dated April 1, 2004;
7. the resolution adopted by the City Council of the City on March 23, 2004 (the
"City's Resolution ") approving the issuance of the Bonds and authorizing the execution of and
approving the Financing Agreement, the Purchase Contract, and the Project Agreement;
8. such other agreements, documents, certificates, opinions, letters, and other papers
as we have deemed necessary or appropriate in rendering the opinions set forth below; and
9. 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 hereinaRer set
forth, 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:
1. 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 Issuer
Documents, 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 Issuer Documents, and the Bond Resolution, and all
other transactions contemplated by the Official Statement in connection with the issuance of the
Bonds; 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, and the Issuer Documents; and
assuming the due authorization, execution, and delivery by the other contracting 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 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.
3. The statements in the 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.
45~1~6.2 C-2
4. The City is a home role municipality, a political subdivision of the State of Texas,
and a body politic and corporate, duly created, orgarfized 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 Economic Development 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,
454214~6.2 C-3
EXHIBIT D
[Letterhead ofFulbright & Jaworski L.L.P.]
April 27, 2004
Morgan Keegan & Company, Inc.,
as Authorized Representative of
a Group of Underwriters
5956 Sherry Lane, Suite 1900
Dallas, Texas 75225
Ladies and Gentlemen:
We have acted as your counsel in connection with the purchase by you on this date of
$ original principal amount of "Corpus Christi Business And Job Development
Corporation Sales Tax Revenue Bonds, Series 2004 (Baseball Stadium Project)" (the "Bonds")
pursuant to a Purchase Contract dated April 1, 2004 (the "Purchase Contract") between you and
the Corpus Christi Business and Job Development Corporation (the "Corporation'% Tins
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 Agreement, 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 force and effect on the date hereof:
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 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
45421446 2 D-1
Statement with representatives of the Corporation, McCall, Parkhurst & Horton L.L.P., Bond
Counsel, Coastal Securities, 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 contxacts 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 fact 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 g/ven in writing by us.
Very truly yours,
454214~6.2 D-2
EXHIBIT E
Opinion of City Attomey
April 27, 2OO4
Corpus Christi Business
and Job Development Corporation
1201 Leopard
Corpus Christi, Texas 78401
City of Corpus Christi, Texas
1201 Leopard
Corpus Christi, Texas 78401
Fulbright & Jaworski L.L.P.
300 Convent, Suite 2200
San Antonio, Texas 78205
Morgan Keegan & Company, Inc.,
as Authorized Representative of
a Group of Underwriters
5956 Sherry Lane, Suite 1900
Dallas, Texas 75225
McCall, Parkhurst & Horton L.L.P.
717 North Harwood, Suite 900
Dallas, Texas 75201
Coastal Securities
5555 San Felipe, Suite 2200
Houston, Texas 77002
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
$ original principal amount of "Corpus Christi Business and Job Development
Corporation Sales Tax Revenue Bonds, Series 2004 (Baseball Stadium 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 "Corporation ") on March 22, 2004 (the
"Bond Resolution '~. The Bond Resolution, the Financing Agreement, the Purchase Con~'act, the
Project Agreement, and the Paying Agent/Registrar Agreement are referred to herein as the
"Issuer Documents". Capitalized terms not otherwise defined in this letter have the meanings
assigned in the Purchase Contract dated April 1, 2004, executed between the City and Morgan
Keegan & Company, Inc., as the author/zed representative of the underwriters (the "Purchase
Contract').
In my capacity as City Attorney to the City, I have reviewed the following:
1. a certified copy of the Bond Resolution;
2. an executed counterpart of the Purchase Contract;
3. an executed counterpart of the Sales Tax Remittance Agreement dated as of April
1, 2004 (the "Financing Agreement') between the Corporation and the City;
4. an executed counterpart of the Project Agreement dated as of April 1, 2004 (the
"ProJect Agreement") between the Corporation and the City;
45421446.2 E-I
5. an executed counterpart of the Paying Agent/Registrar Agreement dated as of
April 1, 2004 between the Corporation and JPMorgan Chase Bank, Dallas, Texas (the "Paying
Agent/Registrar Agreement'');
6. a copy of the Official Statement dated April 1, 2004;
7. the resolution adopted by the City Cotmcil of the City on March 23, 2004 (the
"City's Resolution ") approving the issuance of the Bonds and authorizing the execution of and
approving the Financing Agreement, the Purchase Contract, and the Project Agreement;
8. 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
9. 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 I believe necessary to enable me to render the opinions herein contained.
In making my review, I 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, I 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:
1. 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 has 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 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.
2. 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 Economic Development Sales Tax securing the Bonds for the benefit of the Corporation
under the Act.
3. 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
454214415.2 E-2
validly exisfmg under the provisions of the Act, and is acting on behalf of the City in accordance
with such Act.
4. 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 would 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.
5. 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 judgment 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 otherwise 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
the 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 instruments does not constitute a breach 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 knowledge, 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.
6. There is no litigation, 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, al~er due inquiry
ttu-eatened 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 offices, or affecting or seeking to
prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the collection of the
Economic Development 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 Issuer Documents, nor, to the best knowledge of
the City and the Corporation, is there any basis therefor, wherein an unfavorable decision, ruling
or fmding would materially adversely affect the validity or enforceability of the Bonds, the Bond
Resolution, the City's Resolution, or the Issuer Documents.
7. 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
45421446.2 E-3
law, administrative regulation, order, or consent decree to which the City or the Corporation is
subject.
8. By official action the City has taken all steps to duly authorize, levy and collect
the Economic Development Sales Tax and approve the City's Resolution all in accordance with
the Act;
9. Except as disclosed in the Official Statement, no litigation is pending, or to my
knowledge, tl~-eatened, in any court, (1) seeking to enjoin the issuance or delivery of the Bonds
or the execution and delivery of the Issuer 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 Issuer Documents, or the levying of the
Economic Development 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;
10. The statements in the Official Statement under the captions "INTRODUCTION -
Description of the Corporation", "PROJECT DESIGN AND CONSTRUCTION", "STADILrM
LEASE AGREEMENT", "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 tree and correct.
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 Statement nothing has come to our attention which would lead us
to believe that the Official Statement (excluding therefi-om 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 permission is given in writing by me.
Very truly yours,
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