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MEMORANDUM
To:
From:
Date:
Subject:
Mayor, City Council, City Manager
EDC Board of Directors
Mark Sokolow, City Attorney ~ ~
May 21, 2003
EDC Resolution
Joint EDC/Council Meeting May 27, 2003
Attached is the bond resolution prepared by Vinson & Elkins.
The project is construction of the public infrastructure
improvement for the new Hospital, Medical Office Building,
Business Park and adjacent commercial areas.
MTS/ts
Attachment
cc: Director of Finance
Executive Director of EDC
VIA FACSIMILE (713) 758-2222
Frank McCreary
VIA FACSIMILE (409) 724-7585
Jim Wimberley
z .edc_j oint mt g. memo
DRAFT
05/19/03
EDC RESOLUTION NO.
RESOLUTION AUTHORIZING THE ISSUANCE OF CITY OF PORT ARTHUR
SECTION 4A ECONOMIC DEVELOPMENT CORPORATION SALES TAX
REVENUE BONDS, SERIES 2003; PRESCRIBING THE TERMS AND
CONDITIONS OF SAID BONDS; PROVIDING FOR THE SECURITY FOR AND
PAYMENT OF SAID BONDS; AWARDING THE SALE THEREOF; AND
CONTAINING OTHER PROVISIONS RELATING TO THE SUBJECT
WHEREAS, the City of Port Arthur Section 4A Economic Development Corporation (the
"Corporation") is a non-profit industrial development corporation created, existing and governed by
Section 4A of Article 5190.6, Tex. Rev. Civ. Stat. Ann., as amended (the "Act"); and
WHEREAS, pursuant to the authority granted in the Act, the City of Port Arthur, Texas (the
"City") has levied a Sales Tax (as defined herein) for the benefit of the Corporation, to be used
exclusively for the purposes set forth in the Act; and
WHEREAS, the Corporation is authorized by the Act to issue its revenue bonds, to be
secured by and payable from such Sales Tax, in the manner and for the purposes hereinafter
provided; and
WHEREAS, it is hereby found and determined that the Projects (as defined herein) will
promote new and expanded business development in the City and are required for the promotion of
job recreation and retention in the City; and
WHEREAS, it is hereby found and determined that the issuance and delivery of the bonds
hereinafter authorized is in the public interest and the use of the proceeds thereof in the manner
specified herein constitutes a valid public purpose; and
WHEREAS, it is officially found, determined, and declared that the meeting at which this
Resolution has been adopted was open to the public and public notice of the time, place and subject
matter of the public business to be considered and acted upon at said meeting, including this
Resolution, was given, all as required by the applicable provisions of Chapter 551, Texas
Government Code, as amended; Now, Therefore
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF PORT
ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION:
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01..Definitions.
Unless otherwise expressly provided or unless the context clearly requires otherwise, in this
Resolution the following terms shall have the meanings specified below:
"Additional Bonds" means the additional sales tax revenue bonds the Corporation reserves
the right to issue on a parity with the Bonds, in accordance with the terms and conditions prescribed
in Section 9.02 hereof.
"Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of
Representations between the Corporation and DTC.
"Board" means the Board of Directors of the Corporation.
"Bonds" means the Corporation's bonds entitled "City of Port Arthur Section 4A Economic
Development Corporation Sales Tax Revenue Bonds, Series 2003" authorized to be issued by this
Resolution.
"Closing Date" means the date of the initial delivery of and payment for the Bonds.
"Code" means the Internal Revenue Code of 1986, as amended, including applicable
regulations, published rulings and court decisions relating thereto.
"Comptroller" means the Comptroller of Public Accounts of the State of Texas and any
successor officer or official that may be charged by law with the duty of collecting Sales Tax
Revenues for the account of, and remitting the same to, the City for the account of the Corporation.
"Costs of the Projects" means all items of costs of or attributable to the Projects and defined
as "Costs" in the Act.
"Debt Service Fund" means the debt service fund established by Section 8.01 of this
Resolution.
"DTC" means The Depository Trust Company of New York, New York, or any successor
securities depository.
"DTC Participant" means any broker, dealer, bank, trust company, clearing corporation or
certain other organizations with Bonds credited to an account maintained on its behalf by DTC.
"Event of Default" means any Event of Default as defined in Section 11.01 of this
Resolution.
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"Fiscal Year" means October 1 through September 30.
"Initial Bond" means the Bond described in Sections 3.04(d) and 6.02(0.
"Interest Payment Date" means the date or dates upon which interest on the Bonds is
scheduled to be paid until the maturity or prior redemption of the Bonds, such dates being
February 15 and August 15 of each year commencing February 15, 2004.
"Issue Date" means the initial date from which interest on the Bonds accrues and which is
designated in Section 3.02(a) of this Resolution.
"Owner" means any person who is the registered owner of a Parity Bond or Bonds.
"Parity Bonds" means the Bonds and Additional Bonds.
"Paying Agent/Registrar" means Wells Fargo Bank Texas, N.A., any successor thereto or an
entity which is appointed as and assumes the duties of Paying Agent/Registrar as provided in this
Resolution.
"Pledged Revenues" means (a) the Sales Tax Revenues and (b) interest and earnings from
investment of funds on deposit in the Revenue Fund, the Debt Service Fund and the Reserve Fund.
"Projects" mean the construction of streets, utilities, drainage improvements and other public
infrastructure improvements to serve a new hospital, medical office building, business park, and
adjacent commercial areas within the City, including the acquisition of land for the construction of
said improvements, and the acquisition of land for future commercial development
"Record Date" means, for any Interest Payment Date, the last Business Day of the month
next preceding an Interest Payment Date.
"Register" means the Register specified in Section 3.06(a) of this Resolution.
"Reserve Fund" means the reserve fund established by Section 8.02 of this Resolution.
"Reserve Fund Requirement" means an amount equal to the lesser of (i) the maximum
annual Debt Service (calculated on a Fiscal Year basis) for all Parity Bonds then Outstanding (after
giving effect to the issuance of any Additional Bonds), as determined on the date each series of
Additional Bonds are delivered or incurred, as the case may be or (ii) the maximum amount in a
reasonably required reserve fund that can be invested without restriction as to yield pursuant to
Subsection (d) of Section 148 of the Internal Revenue Code of 1986, as amended, and regulations
promulgated thereunder.
"Reserve Fund Surety Policy" means any surety bond or insurance policy having a rating in
the highest respective rating categories by Moody's Investors Service, Inc. and Standard & Poor's
Ratings Services, a division of The McGraw-Hill Companies, Inc., issued to the Corporation to
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satisfy all or any part of the Reserve Fund Requirement as provided in Section 8.05(b) of this
Resolution.
"Resolution" means this Resolution.
"Revenue Fund" means the special fund so designated in Section 8.02 hereof.
"Sales Tax" means the local sales and use tax authorized by the Act, approved by the voters
of the City on November 7, 1995, at a rate of one-half of one percent (1/2%), and levied by the City
on behalf of the Corporation.
"Sales Tax Revenues" means all of the revenues collected or received by the City on behalf
of the Corporation, from or by reason of the levy of the Sales Tax.
"Special Payment Date" means the Special Payment Date prescribed by Section 3.03(b) of
this Resolution.
"Special Record Date" means the Special Record Date prescribed by Section 3.03(b) of this
Resolution.
Section 1.02. Other Definitions. The terms "Act," "Corporation" and "City" shall have the
respective meanings assigned in the preamble to this Resolution.
Section 1.03. Findings. The declarations, determinations and findings declared, made and
found in the preamble to this Resolution are hereby adopted, restated and made a part of the
operative provisions hereof.
Section 1.04. Titles and Headings. The titles and headings of the Articles and Sections 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 and
shall never be considered or given any effect in construing this Resolution or any provision hereof
or in ascertaining intent, if any question of intent should arise.
Section 1.05. Interpretation. (a) Unless the context requires otherwise, words of the
masculine gender shall be construed to include correlative words of the feminine and neuter genders
and vice versa, and words of the singular number shall be construed to include correlative words of
the plural number and vice versa.
(b) This Resolution and all the terms and provisions hereof shall be liberally construed
to effectuate the purposes set forth herein to sustain the validity of this Resolution.
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ARTICLE II
SECURITY FOR THE PARITY BONDS
Section 2.01. Confirmation and Levy of Sales Tax. (a) The Corporation hereby confirms
the earlier levy by the City of the Sales Tax, and the Corporation hereby warrants and represents that
the City has duly and lawfully ordered the imposition and collection of the 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 pursuant to applicable law.
(b) If the City shall be authorized hereafter by applicable law to apply, impose and levy
the Sales Tax on any taxable items or transactions that are not subject to the Sales Tax on the date
of the adoption hereof, the Corporation, to the extent it legally may do so, hereby covenants and
agrees to use its best efforts to cause the City to take such action as may be required by applicable
law to subject such taxable items or transactions to the Sales Tax.
(c) The Corporation agrees to take and pursue all action permissible under applicable
law to cause the Sales Tax to be collected and remitted and deposited as herein required and as
required by the Act, at the earliest and most frequent times permitted by applicable law.
Section 2.02. Pledge. The Corporation hereby irrevocably pledges the Pledged Revenues,
to the payment of the principal of, and the interest and any premiums on, the Parity Bonds and to
the establishment and maintenance of the Reserve Fund.
(a) The provisions, covenants, pledge and lien on and against the Pledged Revenues, as
herein set forth, are established and shall be for the equal benefit, protection and security of the
Owners of the Parity Bonds without distinction as to priority and rights.
(b) The Parity Bonds, including interest payable thereon, shall constitute special Bonds
of the Corporation, payable solely from and secured by a first lien on and pledge of the Pledged
Revenues, and not from any other revenues, properties or income of the Corporation. The Parity
Bonds are not a debt of the City and do not give rise to a claim for payment against the City except
as to Sales Tax Revenues held by the City and required by the Act to be paid over to the
Corporation.
Section 2.03. Resolution as Security Agreement. (a) An executed copy of this Resolution
shall constitute a security agreement pursuant to applicable law, with the Owners as the secured
parties. The lien, pledge, and security interest of the Owners created in this Resolution shall become
effective immediately upon the Closing Date of the Bonds, and the same shall be continuously
effective for so long as any Parity Bonds are outstanding.
(b) A fully executed copy of this Resolution and the proceedings authorizing it shall be
filed as a security agreement among the permanent records of the Corporation. Such records shall
be open for inspection to any member of the general public and to any person proposing to do or
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doing business with, or asserting claims against, the Corporation, at all times during regular business
hours.
Section 2.04: Application of Chapter 1208, Government Code. Chapter 1208, Government
Code, applies to the issuance of the Bonds and the pledge of the revenues granted by the Corporation
under Section 2.02 of this Resolution, 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 revenues granted by the Corporation under Section 2.02 of this Resolution is to be
subject to the filing requirements of Chapter 9, Business & Commeme Code, then in order to
preserve to the registered owners of the Bonds the perfection of the security interest in said pledge,
the Corporation agrees to take such measures as it determines are reasonable and necessary under
Texas law to comply with the applicable provisions of Chapter 9, Business & Commerce Code and
enable a filing to perfect the security interest in said pledge to occur.
ARTICLE III
AUTHORIZATION; TERMS AND PROVISIONS
REGARDING THE BONDS
Section 3.01. Authorization. The Corporation's bonds to be designated "City of Port Arthur
Section 4A Development Corporation Sales Tax Revenue Bonds, Series 2003," are hereby
authorized to be issued and delivered in accordance with the laws of the State of Texas in the
aggregate principal amount of $8,050,000 for the purpose of paying costs of the Projects.
Section 3.02. Date, Denomination, Maturities, Numbers and Interest. (a) The Bonds shall
be dated the Issue Date of June 15, 2003, shall be in fully registered form, without coupons, in the
denomination of $5,000 or any integral multiple thereof. The Initial Bond shall be numbered I-1 and
all other Bonds shall be numbered in sequence beginning with R-1.
(b) The Bonds shall mature on August 15 in the years and in the principal amounts set
forth below, with interest on each Bond accruing from the Issue Date, or the most recent Interest
Payment Date to which interest has been paid or provided for at the per annum rates of interest
specified in the table below:
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Principal Interest
Year Amount Rate
2004 $220,000 %
2005 260,000 %
2006 270,000 %
2007 280,000 %
2008 290,000 %
2009 305,000 %
2010 315,000 %
2011 330,000 %
2012 345,000 %
2013 355,000 %
2014 370,000 %
2015 385,000 %
2016 405,000 __%
2017 420,000 %
2018 435,000 %
2019 455,000 __%
2020 475,000 %
2021 500,000 %
2022 520,000 %
2023 545,000
2024 570,000 %
Section 3.03. Medium, Method and Place of Payment. (a) The principal of, premium, if
any, and interest on the Bonds shall be paid in lawful money of the United States of America as
provided in this Section.
(b) Interest on the Bonds shall be payable, on each Interest Payment Date, to the Owners
whose names appear in the Register at the close of business on the Record Date; provided, however,
that in the event of nonpayment of interest on a scheduled Interest 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 Corporation. Notice of the Special Record Date and of the scheduled payment date of the
past due interest (the "Special Payment Date," which shall be at least 15 days after the Special
Record Date) shall be sent at least five business days prior to the Special Record Date by United
States mail, first class postage prepaid, to the address of each Owner of a Bond appearing on the
books of the Paying Agent/Registrar at the close of business on the last business day next preceding
the date of mailing of such notice.
(c) Interest on the Bonds shall be paid by check (dated as of the Interest Payment Date)
and sent by the Paying Agent/Registrar to the person entitled to such payment, United States mail,
first class postage prepaid, to the address of such person as it appears in the Register or by such other
customary banking arrangements acceptable to the Paying AgenffRegistrar and the person to whom
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interest is to be paid; provided, however, that such person shall bear all risk and expenses of such
other customary banking arrangements.
(d) The principal of each Bond shall be paid to the person in whose name such Bond is
registered on the due date thereof (whether at the maturity date or the date of prior redemption
thereof) upon presentation and surrender of such Bond at the principal payment office of the Paying
Agent/Registrar in Minneapolis, Minnesota.
(e) If a date for the payment of the principal of or interest on the Bonds is a Saturday,
Sunday, legal holiday, or a day on which banking institutions in the city in which the principal
payment 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 a Saturday,
Sunday, legal holiday, or day on which such 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.
Section 3.04. Execution and Initial Registration. (a) The Bonds shall be executed on
behalf of the Corporation by the Chairman and Secretary of the Corporation, by their manual or
facsimile signatures, and the official seal of the Corporation shall be impressed or placed in facsimile
thereon. Such facsimile signatures on the Bonds shall have the same effect as if each of the Bonds
had been signed manually and in person by each of said officers, and such facsimile seal on the
Bonds shall have the same effect as if the official seal of the Corporation had been manually
impressed upon each of the Bonds.
(b) In the event that any officer of the Corporation whose manual or facsimile signature
appears on the Bonds ceases to be such officer before the authentication of such Bonds or before the
delivery thereof, such manual or facsimile signature nevertheless shall be valid and sufficient for all
purposes as if such officer had remained in such office.
(c) Except as provided below, no Bond shall be valid or obligatory for any purpose or
be entitled to any security or benefit of this Resolution unless and until there appears thereon the
Certificate of Paying Agent/Registrar substantially in the form provided in this Resolution, duly
authenticated by manual execution of the Paying Agent/Registrar. It shall not be required that the
same authorized representative of the Paying Agent/Registrar sign the Certificate of Paying
Agent/Registrar on all of the Bonds. In lieu of the executed Certificate of Paying Agent/Registrar
described above, the Initial Bond delivered on the Closing Date shall have attached thereto the
Comptroller's Registration Certificate substantially in the form provided in this Resolution, manually
executed by the Comptroller or by her duly authorized agent, which certificate shall be evidence that
the Initial Bond has been duly approved by the Attorney General of the State of Texas and that it is
a valid and binding Bond of the Corporation, and has been registered by the Comptroller.
(d) On the Closing Date, one Initial Bond representing the entire principal amount of the
Bonds, payable in stated installments to the Underwriter (as defined in Section 7.01 below) or its
designee, executed by the manual or facsimile signature of the Chairman and Secretary of the
Corporation, approved by the Attorney General of Texas, and registered and manually signed by the
Comptroller, will be delivered to the Purchaser or its designee. Upon payment for the Initial Bond,
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the Paying Agent/Registrar shall cancel the Initial Bond and deliver registered definitive Bonds to
DTC in accordance with Section 3.09 hereof.
Section 3.05. Ownership. (a) The Corporation, the Paying Agent/Registrar and any other
person may treat the person in whose name any Bond is registered as the absolute owner of such
Bond for the purpose of making and receiving payment of the principal thereof and premium, if any,
thereon, for the further purpose of making and receiving payment of the interest thereon (subject to
the provisions herein that interest is to be paid to the person in whose name the Bond is registered
on the Record Date), and for all other purposes, whether or not such Bond is overdue, and neither
the Corporation nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the
contrary.
(b) All payments made to the person deemed to be the Owner of any Bond in accordance
with this Section shall be valid and effectual and shall discharge the liability of the Corporation and
the Paying Agent/Registrar upon such Bond to the extent of the sums paid.
Section 3.06. Registration, Transfer and Exchange. (a) So long as any Bonds remain
outstanding, the Corporation shall cause the Paying Agent/Registrar to keep at its principal payment
office in Minneapolis, Minnesota, a register (the "Register") in which, subject to such reasonable
regulations as it may prescribe, the Paying Agent/Registrar shall provide for the registration and
transfer of Bonds in accordance with this Resolution.
(b) Registration of any Bond may be transferred in the Register only upon the
presentation and surrender thereof at the principal payment office of the Paying Agent/Registrar in
Minneapolis, Minnesota, for 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, evidencing assignment of the Bonds, or any portion thereof in any integral multiple
of $5,000, to the assignee or assignees thereof, and the right of such assignee or assignees thereof
to have the Bond or any portion thereof registered in the name of such assignee or assignees. No
transfer of any Bond shall be effective until entered in the Register. Upon assignment and transfer
of any Bond or portion thereof, a new Bond or Bonds will be issued by the Paying Agent/Registrar
in conversion and exchange for such transferred and assigned Bond. To the extent possible the
Paying Agent/Registrar will issue such new Bond or Bonds in not more than three business days
after receipt of the Bond to be transferred in proper form and with proper instructions directing such
transfer.
(c) Any Bond may be converted and exchanged only upon the presentation and surrender
thereof at the principal payment office of the Paying Agent/Registrar in Minneapolis, Minnesota,
together with a written request therefor duly executed by the registered owner or assignee or
assignees thereof, or its or their duly authorized attorneys or representatives, with guarantees of
signatures satisfactory to the Paying Agent/Registrar, for a Bond or Bonds of the same maturity and
interest rate and in any authorized denomination and in an aggregate principal amount equal to the
unpaid principal amount of the Bond presented for exchange. Ifa portion of any Bond is redeemed
prior to its scheduled maturity as provided herein, a substitute Bond or Bonds having the same
maturity date, bearing interest at the same rate, in the denomination or denominations of any integral
multiple of $5,000 at the request of the registered owner, and in an aggregate principal amount equal
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to the unredeemed portion thereof, will be issued to the registered owner upon surrender thereof for
cancellation. To the extent possible, a new Bond or Bonds shall be delivered by the Paying
Agent/Registrar to the registered owner of the Bond or Bonds in not more than three business days
after receipt of the Bond to be exchanged in proper form and with proper instructions directing such
exchange.
(d) Each Bond issued in exchange for any Bond or portion thereof assigned, transferred
or converted shall have the same principal maturity date and bear interest at the same rate as the
Bond for which it is being exchanged. Each substitute Bond shall bear a letter and/or number to
distinguish it from each other Bond. The Paying Agent/Registrar shall convert and exchange the
Bonds as provided herein, and each substitute Bond delivered in accordance with this Section shall
constitute an original contractual obligation of the Corporation and shall be entitled to the benefits
and security of this Resolution to the same extent as the Bond or Bonds in lieu of which such
substitute Bond is delivered.
(e) The Corporation will pay the Paying AgenffRegistrar's reasonable and customary
charge for the initial registration or any subsequent transfer, exchange or conversion of Bonds, but
the Paying AgentJRegistrar will require the Owner to pay a sum sufficient to cover any tax or other
governmental charge that is authorized to be imposed in connection with the registration, transfer,
exchange or conversion of a Bond. In addition, the Corporation hereby covenants with the Owners
of the Bonds that it will (i) pay the reasonable and 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, and (ii) pay the fees and charges of the Paying Agent/Registrar for services
with respect to the transfer, registration, conversion and exchange of Bonds as provided herein.
Section 3.07. Cancellation and Authentication. (a) All Bonds paid or redeemed before
scheduled maturity in accordance with this Resolution, and all Bonds in lieu of which exchange
Bonds or replacement Bonds are authenticated and delivered in accordance with this Resolution,
shall be canceled and destroyed upon the making of proper records regarding such payment,
redemption, exchange or replacement. The Paying Agent/Registrar shall periodically furnish the
Corporation with certificates of destruction of such Bonds.
(b) Each substitute or replacement Bond issued pursuant to the provisions of Sections
3.06 and 3.08 of this Resolution, in conversion of and exchange for or replacement of any Bond or
Bonds issued under this Resolution, shall have printed thereon a Paying AgentfRegistrar's
Authentication Certificate, in the form hereinafter set forth. An authorized representative of the
Paying Agent/Registrar shall, before the delivery of any such Bond, manually sign and date such
Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate
is so executed. No additional ordinances, orders, or resolutions need be passed or adopted by the
Corporation, the governing body of the City, or any other body or person so as to accomplish the
foregoing conversion and exchange or 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, and said Bonds shall be of customary type and composition and be printed
on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant
to the Texas Public Securities Procedures Act (Texas Government Code, Chapter 1201, as amended),
and particularly Subchapter D thereof, the duty of conversion and exchange or replacement of Bonds
as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of the
above Paying AgentJRegistrar's Authentication Certificate, the converted and exchanged or replaced
Bonds shall be valid, incontestable, and enforceable in the same manner and with the same effect
as the Initial Bond which was originally delivered pursuant to this Resolution, approved by the
Attorney General, and registered by the Comptroller of Public Accounts.
(c) Bonds issued in conversion and exchange or replacement of any other Bond or
portion thereof, (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 transferred and assigned, (iv) may be
converted and exchanged for other Bonds, (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 Bonds set forth in this Resolution.
Section 3.08. Replacement Bonds. (a) Upon the presentation and surrender to the Paying
Agent/Registrar, at its principal payment office in Minneapolis, Minnesota, of a mutilated Bond, the
Paying Agent/Registrar shall authenticate and deliver in exchange therefor a replacement Bond of
like tenor and principal amount, bearing a number not contemporaneously outstanding. The
Corporation or the Paying Agent/Registrar may require the Owner of such Bond to pay a sum
sufficient to cover any tax or other governmental charge that is authorized to be imposed in
connection therewith and any other expenses connected herewith.
(b) In the event that any Bond is lost, apparently destroyed or wrongfully taken, the
Paying Agent/Registrar, pursuant to the applicable laws of the State of Texas and in the absence of
notice or knowledge that such Bond has been acquired by a bona fide purchaser, shall authenticate
and deliver a replacement Bond of like tenor and principal amount, bearing a number not
contemporaneously outstanding, provided that the Owner first:
(i) furnishes to the Paying Agent/Registrar satisfactory evidence of his
ownership of and the circumstances of the loss, destruction or theft of such Bond;
(ii) furnishes such security or indemnity as may be required by the Paying
Agent/Registrar and the Corporation to save them harmless;
(iii) pays all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Paying Agent/Registrar and any tax or other
governmental charge that is authorized to be imposed; and
(iv) satisfies any other reasonable requirements imposed by the Corporation and
the Paying Agent/Registrar.
(c) If, after the delivery of such replacement Bond, a bona fide purchaser of the original
Bond in lieu of which such replacement Bond was issued presents for payment such original Bond,
the Corporation and the Paying Agent/Registrar shall be entitled to recover such replacement Bond
from the person to whom it was delivered or any person taking therefrom, except a bona fide
purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the
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extent of any loss, damage, cost or expense incurred by the Corporation or the Paying
Agent/Registrar in connection therewith.
(d) In the event that any such mutilated, lost, apparently destroyed or wrongfully taken
Bond has become or is about to become due and payable, the Paying AgenffRegistrar, in its
discretion, instead of issuing a replacement Bond, may pay such Bond.
(e) Each replacement Bond delivered in accordance with this Section shall constitute an
original contractual obligation of the Corporation and shall be entitled to the benefits and security
of this Resolution to the same extent as the Bond or Bonds in lieu of which such replacement Bond
is delivered.
Section 3.09. Book-Entry Only System. (a) The definitive Bonds 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 DTC, and, except as provided in Section 3.10 hereof, all of the outstanding Bonds shall
be registered in the name of Cede & Co., as nominee of DTC.
(b) With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the
Corporation and the Paying Agent/Registrar shall have no responsibility or obligation to any DTC
Participant or to any person on behalf of whom such a DTC Participant holds an interest in the
Bonds, except as provided in this Resolution. Without limiting the immediately preceding sentence,
the Corporation 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 an Owner, as shown on the Register, of any notice with respect to the Bonds, including
any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than
an Owner, as shown in the Register of any amount with respect to principal of, premium, if any, or
interest on the Bonds. Notwithstanding any other provision of this Resolution to the contrary, the
Corporation and the Paying Agent/Registrar shall be entitled to treat and consider the person in
whose name each Bond is registered in the Register as the absolute Owner of such Bond for the
purpose of payment of principal of, premium, if any, and interest on the Bonds, for the purpose of
giving notices of redemption and other matters with respect to such Bond, for the purpose of
registering transfer with respect to such Bond, and for all other purposes whatsoever. The Paying
Agent/Registrar shall pay all principal of, premium, if any, and interest on the Bonds only to or upon
the order of the respective Owners, as shown in the Register 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 Corporation's obligations with respect to principal of, premium,
if any, and interest on the Bonds to the extent of the sum or sams so paid. No person other than an
Owner, as shown in the Register, shall receive a Bond certificate evidencing the obligation of the
Corporation to make payments of amounts due 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 or drafts being mailed to the registered Owner at the close of business on the
Record Date, the word "Cede & Co." in this Resolution shall refer to such new nominee of DTC.
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(c) The execution and delivery of the Blanket Issuer Letter of Representations is hereby
approved with such changes as may be approved by the Corporation and the Chairman is hereby
authorized and directed to execute such Blanket Issuer Letter of Representations.
Section 3.10. Successor Securities Depository; Transfer Outside Book-Entry Only System.
In the event that the Corporation or the Paying Agent/Registrar determines that DTC is incapable
of discharging its responsibilities described herein and in the Representation Letter, and that it is in
the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds,
or in the event DTC discontinues the services described herein, the Corporation or the Paying
Agent/Registrar 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, as identified by DTC, 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, as identified by DTC, of the availability through DTC of Bonds and transfer one
or more separate Bonds to DTC Participants having Bonds credited to their DTC accounts, as
identified by DTC. In such event, the Bonds shall no longer be restricted to being registered in the
Register 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 Owners transferring
or exchanging Bonds shall designate, in accordance with the provisions of this Resolution.
Section 3.11. Payments to Cede & Co. Notwithstanding any other provision of this
Resolution to the contrary, so long as any Bonds are registered in the name of Cede & Co., as
nominee of DTC, all payments with respect to principal of, premium, if any, and interest on such
Bonds, and all notices with respect to such Bonds, shall be made and given, respectively, in the
manner provided in the Blanket Issuer Letter of Representations.
ARTICLE IV
OPTIONAL AND MANDATORY REDEMPTION
Section 4.01. Optional and Mandato~ Redemption. The Bonds are subject to optional and
mandatory redemption as set forth in the Form of Bonds in this Resolution.
Principal amounts may be redeemed only in integral multiples of $5,000. Ifa Bond subject
to redemption is in a denomination larger than $5,000, a portion of such Bond may be redeemed,
but only in integral multiples of $5,000. Upon surrender of any Bond for redemption in part, the
Paying Agent/Registrar, in accordance with Section 3.06 hereof, shall authenticate and deliver in
exchange therefor a Bond or Bonds of like maturity and interest rate in an aggregate principal
amount equal to the unredeemed portion of the Bond so surrendered.
Notice of any redemption identifying the Bonds to be redeemed in whole or in part shall be
given by the Paying Agent/Registrar at least thirty days prior to the date fixed for redemption by
sending written notice by first class mail to the Owner of each Bond to be redeemed in whole or in
part at the address shown on the Register at the close of business on the business day next preceding
the date of mailing such notice. Such notices shall state the redemption date, the redemption price,
the place at which Bonds are to be surrendered for payment and, if less than all Bonds outstanding
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of a particular maturity are to be redeemed, the numbers of the Bonds or portions thereof of such
maturity to be redeemed. Any notice given as provided in this Section shall be conclusively
presumed to have been duly given, whether or not the Owner receives such notice. By the date fixed
for redemption, due provision shall be made with the Paying Agent/Registrar for payment of the
redemption price of the Bonds or portions thereof to be redeemed, plus accrued interest to the date
fixed for redemption. When Bonds have been called for redemption in whole or in part and due
provision has been made to redeem same as herein provided, the Bonds or portions thereof so
redeemed shall no longer be regarded as outstanding except for the purpose of receiving payment
solely from the funds so provided for redemption, and the rights of the Owners to collect interest
which would otherwise accrue after the redemption date on any Bond or portion thereof called for
redemption shall terminate on the date fixed for redemption.
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paving Agent/Registrar. (a) The Corporation hereby
appoints Wells Fargo Bank Texas, N.A., as its registrar and paying agent to keep such books or
records and make such transfers and registrations under such reasonable regulations as the
Corporation may prescribe. The Paying Agent/Registrar shall make such transfer and registrations
as herein provided. It shall be the duty of the Paying Agent/Registrar to obtain from the Owners and
record in the Register the address of such Owner of each Bond to which payments with respect to
the Bonds shall be mailed, as provided herein. The Corporation or its designee shall have the right
to inspect the Register during regular business hours of the Paying Agent/Registrar, but otherwise
the Paying Agent/Registrar shall keep the Register Books confidential and, unless otherwise
required by law, shall not permit their inspection by any other entity.
(b) The Corporation hereby further appoints the Paying Agent/Registrar to act as the
paying agent for paying the principal of and interest on the Bonds. The Paying Agent/Registrar shall
keep proper records of all payments made by the Corporation and the Paying Agent/Registrar with
respect to the Bonds, and of all conversions, exchanges and replacements of such Bonds, as provided
in the Resolution.
(c) The execution and delivery of a Paying Agent/Registrar Agreement, specifying the
duties and responsibilities of the Corporation and the Paying Agent/Registrar, is hereby authorized,
and the Chairman and Secretary of the Corporation are hereby authorized to execute such agreement.
Section 5.02. Qualifications. Each Paying Agent/Registrar shall be (i) a commercial bank,
trust company, or other entity duly qualified and legally authorized under the laws of the United
States or any state to serve as paying agent and registrar for the bonds.
Section 5.03. Maintaining Paying Agent/Registrar. At all times while any Bonds are
outstanding, the Corporation will maintain a Paying AgentfRegistrar that is qualified under
Section 5.02 of this Resolution. If the Paying Agent/Registrar resigns or otherwise ceases to serve
as such, the Corporation will promptly appoint a replacement.
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Section 5.04. Termination. The Corporation reserves the right to terminate the appointment
of any Paying Agent/Registrar by delivering to the entity whose appointment is to be terminated a
certified copy of a resolution of the Corporation (i) giving notice of the termination of the
appointment and of the Paying Agent/Registrar Agreement, stating the effective date of such
termination, and (ii) appointing a successor Paying Agent/Registrar.
Section 5.05. Notice of Change to Owners. Promptly upon each change in the entity
serving as Paying Agent/Registrar, the Corporation will cause notice of the change to be sent to each
Owner by United States mail, first class postage prepaid, at the address in the Register, stating the
effective date of the change and the name of the replacement Paying Agent/Registrar and the mailing
address of its principal payment office.
Section 5.06. Agreement to Perform Duties and Functions. By accepting the appointment
as Paying Agent/Registrar, the Paying Agent/Registrar is deemed to have agreed to the provisions
of this Resolution and that it will perform the duties and functions of Paying Agent/Registrar
prescribed hereby.
Section 5.07. Delivery of Records to Successor. Ifa Paying Agent/Registrar is replaced,
such Paying Agent/Registrar, promptly upon the appointment of the successor, will deliver the
Register (or a copy thereof) and all other pertinent books and records relating to the Bonds to the
successor Paying Agent/Registrar.
ARTICLE VI
FORM OF THE BONDS
Section 6.01. Form Generally. (a) The Bonds, including the registration certificate of the
Comptroller, the certificate of the Paying Agent/Registrar, and the assignment form to appear on
each of the Bonds, (i) shall be substantially in the form set forth in this Article, with such appropriate
insertions, omissions, substitutions, and other variations as are permitted or required by this
Resolution, and (ii) may have such letters, numbers, or other marks of identification (including
identifying numbers and letters of the Committee on Uniform Securities Identification Procedures
of the American Bankers Association) and such legends and endorsements (including any
reproduction of an opinion of counsel) thereon as, consistently herewith, may be determined by the
Corporation or by the officers executing such Bonds, as evidenced by their execution thereofi
(b) Any portion of the text of any Bonds may be set forth on the reverse side thereof,
with an appropriate reference thereto on the face of the Bonds.
(c) The Bonds shall be typed, printed, lithographed, or engraved, and may be produced
by any combination of these methods or produced in any other similar manner, all as determined by
the officers executing such Bonds, as evidenced by their execution thereof, except that the Initial
Bond submitted to the Attorney General of Texas, the definitive Bonds delivered to DTC (or any
successor securities depository) and any temporary Bonds may be typewritten or photocopied or
otherwise produced.
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Section 6.02. Form of Bonds. The form of Bonds, including the form of the registration
certificate of the Comptroller, the form of certificate of the Paying Agent]Registrar, and the form of
assignment appearing on the Bonds, shall be substantially as follows:
(a) Form of Bond.
REGISTERED REGISTERED
No. $
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION
SALES TAX REVENUE BOND
SERIES 2003
INTEREST RATE:
MATURITY DATE:
August 15, 20__
ISSUE DATE: CUSIP
June 15, 2003
REGISTERED OWNER:
PRINCIPAL AMOUNT:
DOLLARS
City of Port Arthur Section 4A Economic Development Corporation (the "Corporation"), a
non-profit industrial development corporation governed by Section 4A of Article 5190.6, Tex. Rev.
Civ. Stat. Ann., as amended (the "Act"), in the State of Texas, for value received, hereby promises
to pay to the registered owner identified above or registered assigns, on the maturity date specified
above, upon presentation and surrender of this Bond at Wells Fargo Bank Texas, N.A. (the "Paying
Agent/Registrar"), at its principal payment office in Minneapolis, Minnesota, the principal amount
identified above, in any coin or currency of the United States of America which on the date of
payment of such principal is legal tender for the payment of debts due the United States of America,
and to pay interest on the unpaid principal amount hereof from the later of the Issue Date specified
above or the most recent interest payment date to which interest has been paid or provided for at the
per annum rate of interest specified above, calculated on the basis of a 360 day year of twelve 30
day months. Interest on this Bond is payable by check on February 15 and August 15, beginning on
February 15, 2004, mailed to the registered owner as shown on the books of registration kept by the
Paying Agent/Registrar as of the close of business on the last business day of the month preceding
each interest payment date.
This Bond is one of a series of bonds issued in the aggregate principal amount of $8,050,000
(herein referred to as the "Bonds"), issued pursuant to a certain Resolution of the Board of Directors
of the Corporation (the "Resolution") for the purpose of paying costs of acquiring and constructing
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projects to promote new and expanded business development and job creation and retention in the
City, as authorized by the Act.
This Bond and all the bonds of the series of which it is a part constitute special obligations
of the City of Port Arthur Section 4A Economic Development Corporation and together with the
additional parity bonds which the Corporation has reserved the right to issue are payable as to both
principal and interest solely from a first lien on and pledge of the Pledged Revenues, as described
in the Resolution, including sales tax revenues to be paid to the Corporation by the City of Port
Arthur, Texas (the "City") from the economic development sales tax levied by the City pursuant to
Section 4A of the Act.
NEITHER THE STATE OF TEXAS, THE CITY, NOR ANY POLITICAL CORPORATION,
SUBDIVISION, OR AGENCY OF THE STATE OTHER THAN THE CORPORATION SHALL
BE OBLIGATED TO PAY THE BONDS OR THE INTEREST THEREON AND NEITHER THE
FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE, THE CITY, OR ANY
OTHER POLITICAL CORPORATION, SUBDIVISION, OR AGENCY THEREOF IS PLEDGED
TO THE PAYMENT OF THE PRINCIPAL OF OR THE INTEREST ON THE BONDS.
The Corporation expressly reserves the right to issue additional sales tax revenue bonds on
a parity with the bonds of this issue; provided, however, that any and all such additional bonds may
be issued only in accordance with and subject to the covenants, conditions, limitations and
restrictions relating thereto which are set out and contained in the Resolution, to which reference
is hereby made for full particulars.
The Corporation reserves the right to redeem the Bonds maturing on or after August 15,
2014, in whole or from time to time in part, in integral multiples of $5,000, on August 15, 2013, or
any date thereafter at par plus accrued interest on the principal amounts called for redemption to the
date fixed for redemption. Reference is made to the Resolution for complete details concerning the
manner of redeeming the Bonds.
THE BONDS maturing in the year 20__ (the "Term Bonds") are subject to mandatory
redemption prior to maturity in the amounts and on the dates set out below, at a price equal to the
principal amount to be redeemed plus accrued interest to the redemption date:
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TERM BONDS MATURING IN THE YEAR 20
Mandator~ Redemption
Principal Amount
August 15, 20__
August 15, 20__
August 15, 20__ (maturity)
The particular Term Bonds to be redeemed shall be selected by the Paying Agent/Registrar
by lot or other customary random selection method, on or before January 15 of each year in which
Term Bonds are to be mandatorily redeemed. The principal amount of Term Bonds to be
mandatorily redeemed in each year shall be reduced by the principal amount of such Term Bonds
that have been acquired by the Corporation and delivered to the Paying Agent/Registrar for
cancellation or have been optionally redeemed and which have not been made the basis for a
previous reduction.
Notice of any redemption shall be given at least thirty (30) days prior to the date fixed for
redemption by first class mail, addressed to the registered owners of each Bond to be redeemed in
whole or in part at the address shown on the books of registration kept by the Registrar. When Bonds
or portions thereof have been called for redemption, and due provision has been made to redeem the
same, the amounts so redeemed shall be payable solely bom the funds provided for redemption, and
interest which would otherwise accrue on the amounts called for redemption shall terminate on the
date fixed for redemption.
As provided in the Resolution, and subject to certain limitations therein set forth, this Bond
is transferable upon surrender of this Bond for transfer at the principal payment office of the Paying
Agent/Registrar, with such endorsement or other evidence of transfer as is acceptable to the Paying
Agent/Registrar, and, thereupon, one or more new fully registered Bonds of the same stated maturity,
of authorized denominations, bearing the same rate of interest, and for the same aggregate principal
amount will be issued to the designated transferee or transferees.
The Corporation, the Paying Agent/Registrar, and any other person may treat the person in
whose name this Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided and for all other purposes, whether or not this Bond is overdue, and neither the
Corporation nor the Paying Agent/Registrar shall be affected by notice to the contrary.
It is hereby certified and recited that the issuance of this Bond and the series of which it is
a part is duly authorized by law; that all acts, conditions and things required to be done precedent
to and in the issuance of the Bonds have been properly done and performed and have happened in
regular and due time, form and manner, as required by law; that the issuance of the Bonds does not
exceed any constitutional or statutory limitation; and that due provision has been made for the
payment of the principal of and interest on the Bonds by the pledge of the above-described revenues.
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In wimess whereof, this Bond has been signed with the manual or facsimile signature of the
Chairman and countersigned with the manual or facsimile signature of the Secretary, and the official
seal of the Corporation has been duly impressed, or placed in facsimile, on this Bond.
(AUTHENTICATION
CERTIFICATE)
(SEAL)
CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT
CORPORATION
Chairman
Secretary
(b) Form of Registration Certificate.
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
(SEAL)
(c)
Comptroller of Public Accounts
of the State of Texas
Form of Paving Agent/Registrar's Authentication Certificate.
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered pursuant
to the Resolution described in the text of this Bond.
Wells Fargo Bank Texas, N.A.
By
Authorized Signature
Date of Authentication
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(d) Form of Assignment.
ASSIGNMENT
For value received, the undersigned hereby
sells, assigns, and transfers unto
(Please prim or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer said Bond on the books kept for registration thereof, with full power of
substitution in the premises.
DATED:
Signature Guaranteed:
NOTICE: Signature must be guaranteed
by a member firm of the New York Stock
Exchange or a commercial bank or trust
company.
Registered Owner
NOTICE: The signature above must correspond
to the name of the registered owner as shown
on the face of this Bond in every particular,
without any alteration, enlargement or change
whatsoever.
(e) The Initial Bond shall be in the form set forth in paragraphs (a), (b), and (d) of this
Section, except for the following alterations:
(i) immediately under the name of the Bond, the headings
"INTEREST RATE" and "MATURITY DATE" shall both be
completed with the words "As Shown Below" and the word "CUSIP"
deleted;
(ii) in the first paragraph of the Bond, the words "on the maturity
date specified above" and "at the per annum rate of interest specified
above" shall be deleted and the following shall be inserted at the end
of the first sentence "..., with such principal to be paid in installments
on August 15 in each of the years and in the principal amounts
identified in the following schedule and with such installments
bearing interest at the per annum rates set forth in the following
schedule:
[Information to be inserted from schedule in Section 3.02(b)]
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(iii) the Initial Bond shall be numbered I-1.
Section 6.03. CUSIP Registration. The Corporation may secure identification numbers
through the CUSIP Service Bureau Division of Standard & Poor's Corporation, New York, New
York, and may authorize the printing of such numbers on the face of the Bonds. It is expressly
provided, however, that the presence or absence of CUSIP numbers on the Bonds shall be of no
significance or effect as regards the legality thereof and neither the Corporation nor the attorneys
approving said Bonds as to legality are to be held responsible for CUSIP numbers incorrectly printed
on the Bonds.
ARTICLE VII
SALE OF THE BONDS; USE OF PROCEEDS
Section 7.01. Sale of Bonds; Official Statement. (a) The sale and delivery of the Bonds
to (the "Underwriter") at a price of par, plus a cash
premium of $ , plus accrued interest thereon to the date of delivery, is hereby authorized,
approved, ratified and confirmed, subject to the approving opinion as to the legality of the Bonds
of the Attorney General of the State of Texas, and ofVinson & Elkins L.L.P., Houston, Texas, bond
counsel. It is hereby found and declared that the Bonds were sold at public sale and that the bid of
the Underwriter was the best bid received by the Corporation.
(b) The Preliminary Official Statement for the Bonds (the "Preliminary Official
Statement") is hereby approved, and the Preliminary Official Statement is hereby deemed final as
of its date (except for the omission of pricing and related information) within the meaning and for
the purposes of paragraph (b)(l) of Rule 15c2-12 under the Securities Exchange Act of 1934, as
amended. The use and distribution of the Preliminary Official Statement in the public offering of
the Bonds is hereby ratified, approved and confirmed.
(c) All officers of the Corporation are authorized to take such actions, to execute such
documents, certificates and receipts and to make such elections pertaining to the tax-exempt status
of the Bonds as they may deem necessary and appropriate in order to consummate the delivery of
the Bonds.
Section 7.02. Official Statement. The Corporation ratifies and confirms it prior approval
of the form and content of the Preliminary Official Statement prepared in the initial offering and sale
of the Bonds and hereby authorizes the preparation of a final Official Statement reflecting the terms
of the Bond Purchase Agreement with the Underwriter and other relevant matters. The use of such
Official Statement in the reoffering of the Bonds by the Underwriter is hereby approved and
authorized.
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Section 7.03. Control and Delivery of Bonds. (a) The Chairman is hereby authorized to
have control of the Initial Bond and all necessary records and proceedings pertaining thereto pending
investigation, examination and approval of the Attorney General of the State of Texas, registration
by the Comptroller of Public Accounts of the State of Texas.
(b) After registration by the Comptroller of Public Accounts, delivery of the Bonds shall
be made to the Underwriter subject to receipt by the Corporation of all amounts due to the
Corporation under the terms of sale.
Section 7.04 Use of Proceeds. Proceeds from the sale of the Bonds shall, promptly upon
receipt by the Corporation, be applied as follows:
(a) Accrued interest on the Bonds shall be deposited into the Debt Service Fund.
(b)
An amount equal to the Reserve Fund Requirement shall be deposited into
the Reserve Fund.
(c)
All other proceeds of the Bonds shall be used for the purposes described in
Section 3.01 of this Resolution and for paying the costs of issuance of the
Bonds, with any remaining proceeds, including earnings on investment of
such proceeds, being transferred to the Debt Service Fund.
ARTICLE VIII
SECURITY AND SOURCE OF
PAYMENT FOR ALL PARITY BONDS
Section 8.01: Pledge and Source of Payment. The Corporation hereby covenants and agrees
that all Pledged Revenues shall be deposited and paid into the special funds established for Parity
Bonds, as provided in this Resolution, and shall be applied in the manner set out herein, to provide
for the payment of principal, interest and any redemption premium of the Parity Bonds and all
expenses of paying, securing and insuring the same. The Parity Bonds constitute special obligations
of the Corporation that are payable solely from, and equally and ratably secured by a first lien on,
the Pledged Revenues, as collected and received by the Corporation, which Pledged Revenues are
hereby pledged to the payment of the Parity Bonds and shall be set aside in the Debt Service Fund
and Reserve Fund as hereinafter provided. The Parity Bonds shall be in all respects on a parity with
and of equal dignity with one another.
Section 8.02: Special Funds. (a) The following special funds are hereby established, and
such funds shall be maintained and accounted for as hereinafter provided, so long as any Parity
Bonds remain outstanding:
(i)
City of Port Arthur Section 4A Economic Development Corporation Sales
Tax Revenue Fund (the "Revenue Fund");
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(ii) City of Port Arthur Section 4A Economic Development Corporation Sales
Tax Revenue Bonds Debt Service Fund (the "Debt Service Fund"); and
(iii)
City of Port Arthur Section 4A Economic Development Corporation Sales
Tax Revenue Bonds Reserve Fund (the "Reserve Fund").
(b) The Revenue Fund shall be maintained as a separate account on the books of the
Corporation.
(c) The Debt Service Fund and the Reserve Fund (i) shall be maintained at an official
depository bank of the Corporation separate and apart from all other funds and accounts of the
Corporation, (ii) shall constitute trust funds which shall be held in trust for the benefit of the Owners
of the Parity Bonds, and (iii) the proceeds of which shall be and are hereby pledged to the payment
of the Parity Bonds. All of the funds named above shall be used solely as provided in this
Resolution so long as any Parity Bonds remain outstanding.
Section 8.03: Flow of Funds. All Pledged Revenues shall be deposited upon receipt into
the Revenue Fund. Money from time to time on deposit in the Revenue Fund shall be applied as
follows in the following order of priority:
(a)
First, to make all deposits into the Debt Service Fund required by this
Resolution and any resolution authorizing the issuance of Additional Bonds.
(b)
Second, to make all deposits into the Reserve Fund required by this
Resolution and any resolution authorizing the issuance of Additional Bonds.
(c)
Third, to pay any amounts due to any bond insurer of Parity Bonds not paid
pursuant to subsections (a) or (b) above.
(d)
Fourth, to pay any amounts due to any issuer of a Reserve Fund Surety Policy
not paid pursuant to subsections (b) or (c) above.
(e) Fifth, to pay administrative expenses of the Corporation.
(f)
Sixth, to pay any amounts due the City for economic development costs
incurred on behalf of or pursuant to contracts with the Corporation.
(g) Seventh, for any lawful purpose.
Whenever the total amounts on deposit to the credit of the Debt Service Fund and the Reserve Fund
shall be equivalent to the sum of the aggregate principal amount of all outstanding Parity Bonds plus
the aggregate amount of all interest accrued and to accrue thereon, no further payments need be
made into the Debt Service Fund or the Reserve Fund.
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Section 8.04: Debt Service Fund. On or before the last Business Day of each month so long
as any Parity Bonds remain outstanding, there shall be transferred into the Debt Service Fund from
the Revenue Fund:
(i)
such amounts, in approximately equal monthly installments,
as will be sufficient to accumulate the amount required to pay
the interest scheduled to become due on the Parity Bonds on
the next interest payment date; and
(ii)
such amounts, in approximately equal monthly installments,
as will be sufficient to accumulate the amount required to pay
the next maturing principal of the Parity Bonds, including the
principal amounts of, and any redemption premium on, any
Parity Bonds payable as a result of the exercise or operation
of any optional or mandatory redemption provision contained
in any resolution authorizing the issuance of Parity Bonds.
Money deposited to the credit of the Debt Service Fund shall be used solely for the purpose of
paying principal (at maturity or prior redemption or to purchase Parity Bonds issued as term bonds
in the open market to be credited against mandatory redemption requirements), interest and any
redemption premium on the Parity Bonds, plus all bank charges and other costs and expenses
relating to such payment. The Paying Agent/Registrar shall destroy all paid Parity Bonds and shall
provide the Corporation with appropriate certificates of destruction.
Section 8.05: Reserve Fund. (a) Unless the Reserve Fund Requirement is funded from
bond proceeds, on or before the last Business Day of each month so long as any Parity Bonds remain
outstanding, and after making the transfers into the Debt Service Fund required in the preceding
Section, there shall be transferred into the Reserve Fund from the Revenue Fund, in approximately
equal monthly installments, amounts sufficient to accumulate within 36 months the Reserve Fund
Requirement. Each increase in the Reserve Fund Requirement resulting from the issuance of
Additional Bonds shall be accumulated within 36 months of the issuance of such bonds by making
transfers from the Revenue Fund into the Reserve Fund in approximately equal monthly installments
of amounts sufficient for such purpose. After the Reserve Fund Requirement has accumulated in
the Reserve Fund and so long thereafter as the Reserve Fund contains the Reserve Fund
Requirement, no further deposits shall be required to be made into the Reserve Fund, and any excess
amounts may be transferred to the Revenue Fund. But if and whenever the balance in the Reserve
Fund is reduced below the Reserve Fund Requirement, either due to a draw on the funds or
reduction or cancellation of a Reserve Fund Surety Policy, the Corporation shall make deposits into
the Reserve Fund from the first funds available for such purpose until the Reserve Fund again equals
the Reserve Fund Requirement. The Reserve Fund shall be used to pay the principal of and interest
on the Parity Bonds at any time when there is not sufficient money available in the Debt Service
Fund for such purpose and to pay and retire the last Parity Bonds to mature or be redeemed.
(b) The Corporation expressly reserves the right at any time to satisfy all or any part of
the Reserve Fund Requirement by obtaining for the benefit of the Reserve Fund a Reserve Fund
Surety Policy (as defined below). In the event the Corporation elects to substitute at any time a
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Reserve Fund Surety Policy for any funded amounts in the Reserve Fund, it may apply any bond
proceeds thereby released, including investment earnings on bond proceeds, to any purposes for
which the bonds were issued and any other funds thereby released to any purposes for which such
funds may lawfully be used, including the payment of debt service on the Parity Bonds. A Reserve
Fund Surety Policy shall be an insurance policy or other credit agreement in a principal amount
equal to the portion of the Reserve Fund Requirement to be satisfied and issued by a financial
institution or insurance company with a rating for its long term unsecured debt or claims paying
ability in the highest letter category by two major municipal securities evaluation sources. A
Reserve Fund Surety Policy shall be for the pro rata benefit of all Parity Bonds. The premium for
any such policy shall be paid from bond proceeds or other funds of the Corporation lawfully
available for such purpose. Any Reserve Fund Surety Policy shall be authorized by resolution and
submitted to the Attorney General for examination and approval.
All surplus in the Reserve Fund in excess of the Reserve Fund Requirement may, at the
option of the Corporation, be deposited in the Revenue Fund; provided, however, that bond proceeds
deposited in the Reserve Fund and investment earnings on such proceeds, may only be used of the
purposes for which the bonds were issued.
Section 8.06: Deficiencies in Funds. If in any month there shall not be deposited into any
Fund maintained pursuant to this Article the full amounts required herein, amounts equivalent to
such deficiency shall be set apart and paid into such Fund or Funds from the first available and
unallocated money in the Revenue Fund, and such payment shall be in addition to the amounts
otherwise required to be paid into such Funds during the succeeding month or months.
Section 8.07: Investment of Funds; Transfer of Investment Income. (a) Money in the
Revenue Fund, the Debt Service Fund and the Reserve Fund may, at the option of the Corporation,
be invested as permitted by law; provided that all such deposits and investments 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, and provided further that in no event shall such deposits or investments of money in
the Reserve Fund mature later than the final maturity date of the Parity Bonds. Any obligation in
which money is so invested shall be kept and held in the Fund from which the investment was made.
All such investments shall be promptly sold when necessary to prevent any default in connection
with the Parity Bonds.
(b) All interest and income derived from such deposits and investments shall be credited
as received to the Fund from which the investment was made.
ARTICLE IX
ADDITIONAL BONDS
Section 9.01. Issuance of Superior Lien Obligations Prohibited. The Corporation hereby
covenants that so long as any principal or interest pertaining to any Parity Bonds remain outstanding
and unpaid, it will not authorize or issue obligations secured by a lien on or pledge of the Pledged
Revenues superior to the lien securing the Parity Bonds.
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Section 9.02. Issuance of Additional Bonds Authorized. In addition to the right to issue
obligations of inferior lien, the Corporation reserves the fight to issue Additional Bonds which, when
duly authorized and issued in compliance with law and the terms and conditions hereinafter
appearing, shall be on a parity with the Bonds herein authorized, payable from and equally and
ratably secured by a lien on and pledge of the Pledged Revenues; and the Bonds and Additional
Bonds shall in all respects be of equal dignity. The Additional Bonds may be issued in one or more
installments, provided, however, that none shall be issued unless and until the following conditions
have been met:
(a) The Corporation is not then in default as to any covenant, condition or obligation
prescribed in the resolution authorizing the issuance of the Bonds or any previously issued
Additional Bonds.
(b) Each of the funds created for the payment, security and benefit of the Parity Bonds
contains the amount of money then required to be on deposit therein.
(c) The Corporation has secured from a Certified Public Accountant ("CPA"), a
certificate or report reflecting that for the Fiscal Year next preceding the date of the proposed
Additional Bonds, or a consecutive 12- month period out of the 15-month period next preceding the
month in which the resolution authorizing the proposed Additional Bonds is adopted, the Sales Tax
Revenues were equal to at least 125% of the maximum annual principal and interest requirements
on all Parity Bonds to be outstanding after the issuance of the proposed Additional Bonds, provided
that, in the event of an increase in the rate of the Sales Tax that becomes effective prior to the date
of the resolution authorizing the issuance of the Additional Bonds, such CPA certificate or report
shall calculate the Sales Tax Revenues for the calculation period as if such increased rate were in
effect during such period.
(d) The Additional Bonds mature on, and interest is payable on, the same days of the
year as the Bonds.
(e) Parity Bonds may be refunded upon such terms and conditions as the Board may
deem to be in the best interest of the Corporation; and if less than all outstanding Parity Bonds are
refunded, the proposed refunding obligations shall be considered as "Additional Bonds" under the
provisions of this Section, and the report or certificate required by paragraph (c) shall give effect to
the issuance of the proposed refunding obligations and shall not give effect to the obligations being
refunded.
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ARTICLE X
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 10.01. Pledged Revenues. (a) The Corporation represents and warrants that it is and
will be authorized by applicable law and by its articles of incorporation and bylaws to authorize and
issue the Bonds, to adopt this Resolution and to pledge the Pledged Revenues in the manner and to
the extent provided in this Resolution, and that the Pledged Revenues are and will remain free and
clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal
rank with, the pledge and lien created in or authorized by this Resolution except as expressly
provided herein for Additional Bonds.
(b) The Bonds and the provisions of this Resolution are and will be the valid and legally
enforceable obligations of the Corporation in accordance with the terms of this Resolution, subject
only to any applicable bankruptcy or insolvency laws or to any applicable law affecting creditors
rights generally.
(c) The Corporation shall at all times, to the extent permitted by applicable law, defend,
preserve and protect the pledge of the Pledged Revenues and all the rights of the Owners under this
Resolution and the resolutions authorizing the issuance of any Additional Bonds, against all claims
and demands of all persons whomsoever.
(d) The Corporation will take, and use its best efforts to cause the City to take, all steps
reasonably necessary and appropriate to collect the Sales Tax to the fullest extent permitted by the
Act and other applicable law.
Section 10.02. Accounts, Periodical Reports and Certificates. The Corporation shall keep
or cause to be kept proper books of record and account (separate from all other records and
accounts) in which complete and correct entries shall be made of its transactions relating to the funds
and accounts established by this Resolution and which, together with all other books and papers of
the Corporation, shall at all times be subject to the inspection of the Owner or Owners of not less
than 5% in principal amount of the Bonds then outstanding or their representatives duly authorized
in writing.
Section 10.03. General. The Directors and Officers of the Corporation shall do and perform
or cause to be done and performed all acts and things required to be done or performed by or on
behalf of the Corporation under the provisions of this Resolution.
Section 10.04. Payment of the Bonds. While any of the Bonds are outstanding and unpaid,
there shall be made available to the Paying Agent/Registrar, out of the Debt Service Fund, money
sufficient to pay the interest on and the principal of the Bonds, as applicable, when due.
Section 10.05. Provisions Concerning Federal Income Tax Exclusion. (a) General. The
Corporation intends that the interest on the Bonds shall be excludable from gross income for
purposes of federal income taxation pursuant to sections 103 and 141 through 150 of the Internal
Revenue Code of 1986, as amended (the "Code"), and the applicable regulations promulgated
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thereunder (the "Regulations"). The Corporation covenants and agrees not to take any action, or
knowingly omit to take any action within its control, that if taken or omitted, respectively, would
cause the interest on the Bonds to be includable in the gross income, as defined in section 61 of the
Code, of the holders thereof for purposes of federal income taxation. In particular, the Corporation
covenants and agrees to comply with each requirement of this Section; provided, however, that the
Corporation shall not be required to comply with any particular requirement of this Section if the
Corporation has received an opinion of nationally recognized bond counsel ("Counsel's Opinion")
that such noncompliance will not adversely affect the exclusion from gross federal income tax
purposes of interest on the Bonds or if the Corporation has received a Counsel's Opinion to the effect
that compliance with some other requirement set forth in this Section will satisfy the applicable
requirements of the Code, in which case compliance with such other requirement specified in such
Counsel's Opinion shall constitute compliance with the corresponding requirement specified in this
Section.
(b) No Private Use or Payment and No Private Loan Financing. The Corporation shall
certify, through an authorized officer, employee or agent, that, based upon all facts and estimates
known or reasonably expected to be in existence on the date the Bonds are delivered, the proceeds
of the Bonds will not be used in a manner that would cause the Bonds to be "private activity bonds"
within the meaning of section 141 of the Code and the Regulations. The Corporation covenants and
agrees that it will make such use of the proceeds of the Bonds, including interest or other investment
income derived from the proceeds of bonds or other obligations, regulate the use of property
financed, directly or indirectly, with such proceeds, and take such other and further action as may
be required so that the Bonds will not be "private activity bonds" within the meaning of section 141
of the Code and the Regulations.
(c) No Federal Guaranty. The Corporation covenants and agrees not to take any action,
or knowingly omit to take any action within its control, that, if taken or omitted, respectively, would
cause the Bonds to be "federally guaranteed" within the meaning of section 149(b) of the Code and
the Regulations, except as permitted by section 149(b)(3) of the Code and the Regulations.
(d) Bonds are not Hedge Bonds. The Corporation covenants and agrees not to take any
action, or knowingly omit to take any action, and has not knowingly omitted and will not knowingly
omit to take any action, within its control, that, if taken or omitted, respectively, would cause the
Bonds to be "hedge bonds" within the meaning of section 149(g) of the Code and the Regulations.
(e) No-Arbitrage Covenant. The Corporation shall certify, through an authorized officer,
employee or agent, that, based upon all facts and estimates known or reasonably expected to be in
existence on the date the Bonds are delivered, the Corporation will reasonably expect that the
proceeds of the Bonds will not be used in a manner that would cause the Bonds to be "arbitrage
bonds" within the meaning of section 148(a) of the Code and the Regulations. Moreover, the
Corporation covenants and agrees that it will make such use of the proceeds of the Bonds, including
interest or other investment income derived from Bond proceeds, regulate investments of proceeds
of the Bonds, and take such other and further action as may be required so that the Bonds will not
be "arbitrage bonds" within the meaning of section 148(a) of the Code and the Regulations.
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(f) Arbitrage Rebate. If the Corporation does not qualify for an exception to the
requirements of section 148(0 of the Code, the Corporation will take all necessary steps to comply
with the requirement that certain amounts earned by the Corporation on the investment of the "gross
proceeds" of the Bonds (within the meaning of section 148(f)(6)(B) of the Code), be rebated to the
federal government. Specifically, the Corporation will (i) maintain records regarding the investment
of the gross proceeds of the Bonds as may be required to calculate the amount earned on the
investment of the gross proceeds of the Bonds separately from records of amounts on deposit in the
funds and accounts of the Corporation allocable to other bond issues of the Corporation or moneys
which do not represent gross proceeds of any bonds of the Corporation, (ii) calculate at such times
as are required by the Regulations, the amount earned from the investment of the gross proceeds of
the Bonds which is required to be rebated to the federal government, and (iii) pay, not less often than
every fifth anniversary date of the delivery of the Bonds or on such other dates as may be permitted
under the Regulations, all amounts required to be rebated to the federal government. Further, the
Corporation will not indirectly pay any amount otherwise payable to the federal government
pursuant to the foregoing requirements to any person other than the federal government by entering
into any investment arrangement with respect to the gross proceeds of the Bonds that might result
in a reduction in the amount required to be paid to the federal government because such arrangement
results in a smaller profit or a larger loss than would have resulted if the arrangement had been at
arm's length and had the yield on the issue not been relevant to either party.
(g) Information Reporting. The Corporation covenants and agrees to file or cause to be
filed with the Secretary of the Treasury, not later than the 15th day of the second calendar month
after the close of the calendar quarter in which the Bonds are issued, an information statement
concerning the Bonds, all under and in accordance with section 149(e) of the Code and the
Regulations.
(h) Continuing Obligation. Notwithstanding any other provision of this Resolution, the
Corporation's obligations under the covenants and provisions of this Section shall survive the
defeasance and discharge of the Bonds.
ARTICLE XI
DEFAULT AND REMEDIES
Section 11.01. Events of Default. Each of the following occurrences or events for the
purpose of this Resolution is hereby declared to be an "Event of Default," to wit:
(i) the failure to make payment of the principal of or interest on any of the Bonds
when the same becomes due and payable; or
(ii) default in the performance or observance of any other covenant, agreement
or obligation of the Corporation under this Resolution, and the continuation thereof for a
period of 30 days after notice of such default is given by any Owner to the Corporation.
Section 11.02. Remedies for Default. (a) Upon the happening of an Event of Default, then
and in every case any Owner or an authorized representative thereof, including but not limited to,
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a trustee or trustees therefor, may proceed against the Corporation for the purpose of protecting and
enforcing the rights of the Owners under this Resolution, by mandamus or other suit, action or
special proceeding in equity or at law, in any court of competent jurisdiction, for any relief permitted
by law, including the specific performance of any covenant or agreement contained herein.
(b) All such proceedings shall be instituted and maintained for the equal benefit of all
Owners of Bonds then outstanding.
Section 11.03. Remedies Not Exclusive. (a) No remedy herein conferred or reserved is
intended to be exclusive of any other available remedy or remedies, but each and every such remedy
shall be cumulative and shall be in addition to every other remedy given hereunder or under the
Bonds or now or hereafter existing at law or in equity; provided, however, that notwithstanding any
other provision of this Resolution, the right to accelerate the debt evidenced by the Bonds shall not
be available as a remedy under this Resolution.
(b) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
ARTICLE XII
DISCHARGE
Section 12.01. Discharge by Deposit. The Corporation may discharge its obligation to the
Owners of any or all of the Parity Bonds to pay principal, interest and redemption premium (if any)
thereon in any manner then permitted by law, including by depositing with any paying agent for such
Parity Bonds or with the State Treasurer of the State of Texas either: (i) cash in an amount equal to
the principal amount and redemption premium, if any, of such Parity Bonds plus interest thereon to
the date of maturity or redemption, or (ii) pursuant to an escrow or trust agreement, cash and/or
securities of any type authorized by the laws of the State of Texas for a refunding escrow account,
in principal amounts and maturities and bearing interest at rates sufficient to provide for the timely
payment of the principal amount and redemption premium, if any, of such Parity Bonds plus interest
thereon to the date of maturity or redemption; provided, however, that if any &such Parity Bonds
are to be redeemed prior to their respective dates of maturity, provision shall have been made for
giving notice of redemption as provided in the resolution authorizing such Parity Bonds.
ARTICLE XIII
CONTINUING DISCLOSURE UNDERTAKING
Section 13.01. Definitions of Continuing Disclosure Terms. (a) As used in this Article, the
following terms have the meanings assigned to such terms below:
"MSRB" means the Municipal Securities Rulemaking Board.
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"NRMSIR" 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.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
"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 within the meaning of the Rule from time to time.
Section 13.02. Continuing Disclosure Undertaking. The Corporation qualifies for the small
issuer exemption from Rule because the Corporation has less than $10,000,000 in aggregate amount
of outstanding bonds (including the Bonds).
(a) Financial Information and Operating Data. The Corporation shall provide financial
information and operating data with respect to the Corporation which is customarily prepared by the
Corporation and is publicly available, upon written request of any person. The information to be
provided includes all quantitative financial information and operating data with respect to the
Corporation of the general type included in the final Official Statement authorized by Section 7.01
of this Resolution under Tables numbered 1 through 4 and in Appendix B. The Corporation will
update and provide this information with six months after the end of each fiscal year.
If the Corporation changes its fiscal year, it will notify each NRMSIR and the SID of the
change (and of the date of the new fiscal year end) prior to the next date by which the Corporation
otherwise would be required to provide financial information and operating data pursuant to this
Section.
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 each NRMSIR and the SID or filed with the SEC.
(b) Material Event Notices. The Corporation shall notify the SID and either each
NRMSIR or 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:
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;
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H.
I.
J.
Adverse tax opinions or events affecting the tax-exempt status of the
Bonds;
Modifications to rights of holders of the Bonds;
Bond calls;
Defeasances;
Release, substitution, or sale of property securing repayment of the
Bonds; and
Rating changes.
The Corporation shall notify the SID and either each NRMSIR or the MSRB, in a timely
manner, of any failure by the Corporation to provide financial information or operating data in
accordance with Section 13.02(a) of this Resolution.
(c) Limitations, Disclaimers, and Amendments. The Corporation shall be obligated to
observe and perform the covenants specified in this Section for so long as, but only for so long as,
the Corporation remains an "obligated person" with respect to the Bonds within the meaning of the
Rule, except that the Corporation in any event will give notice of any deposit made in accordance
with Texas law that causes Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and the 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 Corporation
undertakes to provide only 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 Corporation'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 Corporation 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.
UNDER NO CIRCUMSTANCES SHALL THE CORPORATION 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 CORPORATION, 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.
No default by the Corporation 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 Corporation under federal and state securities laws.
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The provisions of this Article may be amended by the Corporation 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 Corporation, but only if (i) the
provisions of this Article, 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 to the date of such amendment, as well as such changed
circumstances, and (ii) either (A) the Owners of a majority in aggregate principal amount (or any
greater amount required by any other provisions 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 Corporation (such as nationally recognized bond counsel) determines that such amendment
will not materially impair the interests of the Owners and beneficial owners of the Bonds. The
Corporation may also amend or repeal the provisions of this continuing disclosure agreement if the
SEC amends or repeals the applicable provisions 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 form lawfully purchasing or selling Bonds in the
primary offering of the Bonds. If the Corporation so amends the provisions of this Article, it shall
include with any amended financial information or operating data next provided in accordance with
Section 13.02 an explanation, in narrative form, of the masons for the amendment and of the impact
of any change in the type of financial information or operating data so provided.
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ADOPTED AND EFFECTIVE this 27th day of May, 2003.
ATTEST:
/si
Chairman
City of Port Arthur Section 4A
Economic Development Corporation
/s/
Secretary
City of Port Arthur Section 4A Economic
Development Corporation
(SEAL)
Approved as to Form
City Attorney
EDC Attorney
James Wimberly
Signature Page for Bond Resolution